&w=3840&q=100)
Behind bankruptcy plea of London start-up: It hired 700 Indian engineers to pose as AI tools
Behind bankruptcy plea of London start-up: It hired 700 Indian engineers to pose as AI tools
London-based Builder.ai, once valued at $1.5 billion and backed by Microsoft and Qatar's sovereign wealth fund, has filed for bankruptcy after it was revealed that its so-called was mostly done manually by engineers in India, According to a report from The Times of India.
According to the report, round 700 Indian engineers were while developing apps. The startup had raised over $445 million by promoting its AI-based app development platform.
STORY CONTINUES BELOW THIS AD
The company marketed its platform as using AI to build apps quickly, powered by a digital assistant named 'Natasha.'
Most of the coding was done manually
However, reports revealed that most of the coding was actually done manually by Indian tech workers, while the company falsely presented their work as AI-generated.
The collapse of Builder.ai
The collapse began in May 2025 when lender Viola Credit seized $37 million from Builder.ai's accounts after discovering the company had inflated its 2024 revenue by 300 per cent. Founder Sachin Dev Duggal had claimed $220 million in sales, but an audit revealed the actual figure was just $50 million.
All engineer, no AI
Concerns about Builder.ai's AI claims had surfaced as early as 2019, when The Wall Street Journal reported that the platform largely depended on human engineers rather than real AI. Former employees described it as 'all engineer, no AI,' according to the report.
The scheme fully unravelled when the new CEO, Manpreet Ratia, who replaced Duggal in February, discovered the extent of the financial misreporting. US prosecutors have since launched an investigation and requested access to the company's records and customer data.
Biggest AI startup collapse
Builder.ai's downfall is considered the biggest AI startup collapse since the ChatGPT-driven investment boom began. The company now owes $85 million to Amazon and $30 million to Microsoft in cloud computing bills. About 1,000 employees have lost their jobs.
'AI washing' in the time of boom
The case has sparked renewed concerns over 'AI washing', a growing trend where companies rebrand traditional services as AI-powered to attract investment during the current tech boom.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Hans India
22 minutes ago
- Hans India
Hyundai Motor India Limited surpasses 1.1 million Sunroof-Equipped vehicles in just 5 years
Hyundai Motor India Limited (HMIL) today announced a remarkable milestone of selling over 1.1 million sunroof-equipped vehicles in India over the last five years. The achievement underscores the evolving aspirations of Indian customers who increasingly seek global features and uncompromising value in their vehicle ownership experience. In 2024, more than 52% of HMILs domestic sales in India featured sunroofs, with the percentage reaching to 54% in 2025 (Jan – June 2025). Commenting on the milestone achievement, Tarun Garg, Whole-Time Director and Chief Operating Officer, Hyundai Motor India Ltd., said, 'This milestone is a strong reflection of the modern Indian customer's aspiration for premium experiences in everyday mobility. At HMIL, we have consistently worked towards democratizing global technologies and high-end features for a broader set of customers. Going forward, we shall continue with our commitment to shape the future of mobility, by blending cutting-edge technology and innovation and future-ready product offerings.' Currently offering sunroofs in 12 out of its 14 models, HMIL has played a pioneering role in popularizing this premium feature across segments. Further cementing its customer-centric approach, HMIL has localized the panoramic sunroof to ensure wider accessibility and greater cost efficiency, strengthening its commitment to the Indian market. With customer expectations steadily rising, HMIL continues to align its product offerings with the evolving definition of value, comfort and lifestyle preferences, empowering more Indians to experience world-class innovation on the move.
Deccan Herald
30 minutes ago
- Deccan Herald
India, Trinidad & Tobago ink six pacts to expand ties
Modi landed in Port of Spain on Thursday in the second leg of his five-nation tour. It is the first bilateral visit by an Indian prime minister to this Caribbean island nation since 1999.
The Hindu
37 minutes ago
- The Hindu
India, Trinidad & Tobago ink six pacts to expand ties
India and Trinidad and Tobago on Friday (July 4, 2025) inked six agreements to shore up their cooperation in several sectors including infrastructure and pharmaceuticals following talks between Prime Minister Narendra Modi and his counterpart Kamla Persad-Bissessar. The two leaders also explored potential collaboration in areas of defence, agriculture, healthcare and digital transformation, unified payments interface (UPI), capacity building and people-to-people exchanges. "The landmark visit of the Prime Minister to Trinidad and Tobago has given a boost to the special ties between the countries," the Ministry of External Affairs (MEA) said. Mr. Modi landed in Port of Spain on Thursday in the second leg of his five-nation tour. It is the first bilateral visit by an Indian Prime Minister to this Caribbean island nation since 1999. In her remarks during the delegation-level talks, Ms. Bissesar noted that Prime Minister Modi's "landmark visit" to Trinidad and Tobago will reinvigorate the deep-rooted bilateral ties between the two countries. On his part, Prime Minister Modi expressed appreciation for Trinidad and Tobago's strong support and solidarity to the people of India in the wake of Pahalgam terror attack. "The two leaders reaffirmed their commitment to fight terrorism in all its forms and manifestations," the Ministry of External Affairs (MEA) said. Prime Minister Modi also met Trinidad and Tobago President Christine Carla Kangaloo. In a social media post, Mr. Modi said a new momentum was added to the friendship between India and Trinidad and Tobago. "Thank you Trinidad & Tobago. The moments here will never be forgotten. We've added new momentum to India-Trinidad & Tobago friendship. My gratitude to President Christine Carla Kangaloo, Prime Minister Kamla Persad-Bissessar, the government and people of this wonderful nation," he said. The six MoUs will provide for deeper cooperation between India and Trinidad and Tobago in the fields of pharmacopoeia, quick-impact projects, culture, sports and diplomatic training among others. Several announcements to foster bilateral ties, including the offer of OCI (Overseas Citizenship of India) card to the sixth generation of the people of Indian-origin in the Caribbean nation were made. The MEA said Mr. Modi and Ms. Bissesar agreed to work together for greater solidarity among the countries of the Global South and to strengthen India-CARICOM partnership. The Caribbean Community (CARICOM) is an intergovernmental organisation of 15 member states in the Caribbean region having the primary objective to promote economic integration and cooperation among the members. "Both leaders also exchanged views on regional and global issues of mutual interest. They called upon greater cooperation to deal with contemporary challenges such as climate change, disaster management, and cyber security," the MEA said. On Prime Minister Modi's meeting with President Kangaloo, the MEA said it was marked by warmth and a reaffirmation of the deep-rooted friendship between the two nations. "The Prime Minister congratulated President Kangaloo on receiving the Pravasi Bharatiya Samman Award this year and expressed deep appreciation for her distinguished public service," it said. "The two leaders reflected on the enduring bonds shared by the two countries, anchored by strong people-to-people ties," it added. The MEA said Prime Minister Modi invited Ms. Bissessar to pay a visit to India, which she accepted. Earlier in the day, Prime Minister Modi addressed the parliament of the Caribbean nation and spoke about the cricket connection between the two countries. "There is a natural warmth in the connection between our two countries. I must say, Indians are among the most passionate fans of the West Indies cricket team! We cheer for them with all our heart, except when they are playing against India," he said. Mr. Modi also lauded the contribution of Indian-origin people to Trinidad and Tobago's development journey. "From politics to poetry, cricket to commerce, calypso to chutney, they contribute to every field. They are an integral part of the vibrant diversity that you all respect." "Together, you have built a nation that lives its motto: 'Together we aspire, together we achieve'," Mr. Modi said. India and Trinidad and Tobago established diplomatic relations on 31 August 1962, the same year the Caribbean nation gained independence. The two countries enjoy traditionally warm and cordial relations, underpinned by shared democratic values, pluralism, and deep-rooted people-to-people ties.
