Microsoft-Backed UK Tech Startup Builder.ai Files for Insolvency
Builder.ai, once a high-flying UK tech startup backed by Microsoft and Qatar’s sovereign wealth fund, has collapsed into insolvency following months of financial turmoil and leadership upheaval. The London-based company, which raised $450 million with promises to simplify app and website development, informed employees of its insolvency plans during a company-wide call on Tuesday.
The firm reportedly confirmed that its primary unit, Engineer.ai Corporation, will enter insolvency proceedings, with an administrator set to oversee its affairs. The downfall marks a major setback for investors who had bet on Builder.ai’s vision of making software creation “as easy as ordering pizza.”
The company attributed its collapse to “historic challenges and past decisions” that strained its finances. Earlier this year, founder Sachin Dev Duggal stepped down as CEO amid scrutiny over his involvement in legal disputes, including being named in Indian criminal investigations—though he denies wrongdoing and maintains he is only a witness in the case.
In April, new CEO Manpreet Ratia disclosed that Builder.ai had revised its 2023 revenue down to $140 million and slashed its 2024 forecast by 25%. The company had also faced questions over its accounting practices, including its choice of an auditor with longstanding ties to Duggal.
The insolvency underscores the challenges facing even well-funded tech startups as they navigate rapid growth, governance issues, and shifting market conditions. Builder.ai’s collapse leaves its future—and the fate of its backers’ investments—in doubt.
