Builder.ai, once a shining star of India’s tech scene, has dramatically collapsed into insolvency. Backed by global investors including Microsoft and SoftBank, the company raised over $500 million with bold claims of AI-powered app creation. But behind the curtains, the reality was far from intelligent. Internal reports revealed that most of the work was being done by human developers, not artificial intelligence.
Founded in 2016, Builder.ai promised users they could build custom software “as easily as ordering pizza.” The company’s founder, Sachin Dev Duggal, famously dubbed himself the “Chief Wizard” of this AI revolution. While the hype worked wonders with investors, it was later discovered that the core technology simply didn’t exist. Developers from India were reportedly writing code manually while the AI platform acted as a glossy illusion.
The Rise and Fall of Builder.ai
The deception didn’t stop there. Builder.ai allegedly exaggerated its revenue numbers to secure continued funding. While investors were told the company generated $220 million in revenue, an internal audit showed the real figure was just $55 million. That’s a staggering 300% inflation — enough to trigger alarms across the startup world. The final blow came when creditor Viola Credit, which had loaned the company $50 million, seized $37 million from its accounts.
With only $5 million left, frozen under local regulations, the company couldn’t even meet payroll. On May 21, Builder.ai quietly announced insolvency through a cold LinkedIn post, citing “historic challenges” as the reason for its failure. Duggal had already stepped down earlier this year but retained his fantasy title as “Chief Wizard.” Now, he faces money laundering investigations in India, while co-founder Saurabh Dhoot deals with loan fraud allegations.
This downfall isn’t just another failed startup — it’s one of the biggest tech frauds in recent memory. Builder.ai’s collapse proves that in the gold rush of AI, not everything that glitters is innovation.
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