Builder.ai was touted as an innovative Microsoft-backed AI startup, and collapsed into bankruptcy after revelation that the flagship non-code development platform was not artificial intelligence but was driven by 700 human engineers in India.
The company has sold the platform, which is being promoted by an AI assistant named “Natasha,” which can assemble software applications such as LEGO Brick. However, recent reports and commentary reveal that behind the scenes, customer requests are manually met by developers rather than by machines.
Commenting on Bernhard Engelbrecht, founder of Evern Finance, I explained it in X's widely distributed post. “Customer requests were sent to an office in India where 700 Indians wrote code on behalf of AI,” he added, adding that the final product is often buggy, dysfunctional and difficult to maintain. “It was all like real artificial intelligence.
The downfall began in 2023 when Viola Credit, a lender who extended $50 million to Builder.ai, seized $37 million after the company defaulted. The move has paralyzed the ability of startups to run or pay their employees. Additional funds held in India remain frozen due to regulatory restrictions. Bloomberg It has been reported.
Builder.ai is currently in formal bankruptcy proceedings in the UK, where court-designated administrators are assessing whether to retrieve the assets of their business or the portions they are rescued. In a LinkedIn statement, the company admitted that “early failures” pushed it “beyond recovery” and declined to comment further on pending legal issues, including subpoena.
Among the fallout, the name of Poetry Innovation has emerged due to its business relationship with Builder.ai, which began around 2021. This link has attracted attention amid a wider scrutiny of Builder.ai's financial practices. However, Umang Bedi, co-founder of the poem and former Facebook India MD, denied any role in economic misconduct.
In the interview BloombergBedi called the allegations “absolutely unfounded falsehood” and argued that the section did not inflate revenues and did not charge services that were not excluded. “We're not the kind of company that's in a revenue-increasing business,” he said.
