Builder.ai, the artificial intelligence startup once valued at $1.5B, announced plans to declare bankruptcy after a major creditor seized most of its cash. Sources claim the startup was lying about AI (reportedly ~700 workers in India) and faked $60m in sales (by “roundtripping” funds with another firm). An internal audit revealed that the company had overstated its projected 2024 sales to creditors by 300%.
This Builder.ai pitch deck from 2019 offers an inside look at the evolution of the company, and how it all started. Builder.ai (formerly Engineer.ai) was founded in 2016 by Sachin Dev Duggal and raised nearly $500 million from investors, including Microsoft and the Qatar Investment Authority. The company’s core mission was to simplify app development through AI-driven solutions.
Builder targeted the “bespoke software” market through their (supposedly) AI-powered app creation platform. For some reason, the 2019 deck cited the “freelance tech work” industry as their TAM, as opposed to devtools or enterprise software. Although it claimed to fully-automate development and operations of bespoke software, Builder was allegedly using overseas workers (not AI) to build these apps.
Back in 2019, Builder claimed to have already grown to $60M revenue (in just 18 months) with customers like BBC, Universal Music Group, and Accenture. These revenue figures were apparently inflated: Builder reportedly faked $60M in sales over four years by sending funds back and forth (in approximately equivalent amounts) with another firm named VerSe Innovation, a practice known as “roundtripping.”
Bizzarely, they claimed to be “bootstrapped” while also “the largest Series A in Europe.” Based on our research, Builder’s $29.5M Series A in 2018 is far from the largest in Europe; the current recordholder appears to be Mistral AI’s $415M Series A in Dec 2023.
When the news broke on X, Steven Tey (founder of Dub.co) pointed out, “someone actually did this IRL,” re-tweeting Sahil Lavingia (founder of Gumroad)’s joke from just the prior week, “If I give you $1m, and you give me the $1m back, we’ll both be at $1m ARR.”
Builder hoped to scale into a $10B company (making them the world’s largest software developer). At it’s peak, Builder AI was valued over $1.5 billion. Now, it’s on the brink of declaring bankruptcy.
