from Hacker News

Builder.ai Collapses: $1.5B 'AI' Startup Exposed as 'Indians'?

by healsdata on 6/3/25, 1:17 PM with 259 comments

  • by dang on 6/4/25, 12:43 AM

    Two claims are being made here, one boring and one lurid.

    The boring claim is that the company inflated its sales through a round-tripping scheme: https://www.bloomberg.com/news/articles/2025-05-30/builder-a... (https://archive.ph/1oyOw). That's consistent with other recent reporting (e.g. https://news.ycombinator.com/item?id=44080640)

    The lurid claim is that the company's AI product was actually "Indians pretending to be bots". From skimming the OP and https://timesofindia.indiatimes.com/technology/tech-news/how..., the only citation seems to be this self-promotional LinkedIn post: https://www.linkedin.com/feed/update/urn:li:activity:7334521... (https://web.archive.org/web/20250602211336/https://www.linke...).

    Does anybody know of other evidence? If not, then it looks bogus, a case of "il faudrait l'inventer" which got traction by piggybacking on an old-fashioned fraud story.

    To sum up: the substantiated claim is boring and the lurid claim is unsubstantiated. When have we ever seen that before? And why did I waste half an hour on this?

    (Thanks to rafram and sva_ for the links in https://news.ycombinator.com/item?id=44172409 and https://news.ycombinator.com/item?id=44175373.)

  • by paxys on 6/3/25, 10:59 PM

    > Less than two months ago, Builder.ai admitted to revising down core sales numbers and engaging auditors to inspect its financials for the past two years. This came amidst concerns from former employees who suggested sales performance had been inflated during prior investor briefings.

    I was hoping for something interesting, but it is just plain old fashioned accounting fraud.

  • by rafram on 6/3/25, 5:25 PM

  • by bartread on 6/3/25, 10:07 PM

    This is not news, or at least not fresh news. The FT reported the collapse ~9 days ago and it was discussed here: https://news.ycombinator.com/item?id=44080640

  • by fazkan on 6/3/25, 6:30 PM

    This is so weird, its not that hard to actually build an app builder. There are multiple open-source repos (bolt etc), they could have just paid their "AI engineer" to actually build an AI engineer.

    Shameless plug, but we built (https://v1.slashml.com), in roughly 2 weeks. Granted its not as mature, but we don't have billions :)

  • by ricardobeat on 6/3/25, 8:40 PM

    So.. where did the $450M go? A team of 700 developers in India built over eight years would have cost a fraction of that.

  • by anal_reactor on 6/3/25, 10:00 PM

    In this whole AI revolution we sometimes forget the power of cheap human labour... and if I recall correctly, that's not the first time such a thing happens. Amazon made a "no-checkout AI automated store" which was a bunch of cameras connected to a bunch of Indians. At this point, I think we should consider "Indians" a valid element of any engineering architecture, because they perfectly fill the niche where you have work that is almost easy to automate, but not quite.

    Of course, "Indian-as-a-Service" doesn't sound as cool as AI, but besides this, I think it's a valid solution and a business model for many use cases.

  • by gamblor956 on 6/3/25, 5:55 PM

    Have been joking with friends that "AI" stand for "Actually Indians".

    We never thought that it wasn't just a joke...

  • by Ancalagon on 6/3/25, 5:03 PM

    Really weird considering how much AI is actually available now

  • by dang on 6/4/25, 12:38 AM

    Recent and related:

    Microsoft-backed UK tech unicorn Builder.ai collapses into insolvency - https://news.ycombinator.com/item?id=44080640 - May 2025 (136 comments)

  • by moonikakiss on 6/4/25, 12:16 AM

    I did due-diligence on Builder.AI for a venture firm I was interning at (circa 2019). It was extremely apparent (Glassdoor, talking to any employee) it was complete BS.

    When I say apparent, it took less than 15 minutes and a couple of google searches to get a sniff of it.

    Somehow, you can still raise $500MM ++.

    I think about that a lot

  • by perryh2 on 6/3/25, 7:01 PM

  • by a_void_sky on 6/4/25, 5:37 AM

    Nobody has mentioned that they were reselling the AWS credits they had. We had them as our billing partner with very good discounts. The day it happened, AWS sent us a mail to remove them as our billing partner.

  • by Havoc on 6/3/25, 5:23 PM

    I've read indications that this was always aimed at hybrid model rather than pure AI, but hard to tell now because all the news is on this indians train.

  • by belter on 6/3/25, 6:56 PM

  • by LeicaLatte on 6/3/25, 9:30 PM

    Do things that don’t scale taken to another level :)

  • by cubano on 6/3/25, 10:09 PM

    We wanted flying cars, but instead got fake AI.

    Shameful.

  • by tartoran on 6/3/25, 8:42 PM

    What happens with all the money they collected from investors? Was it all just squandered away? Pocketed?

  • by ManBeardPc on 6/3/25, 10:08 PM

    Another AI scam. Wasn’t there a similar case with the Amazon stores? Just walk out I think. Could be understood as sound advice if someone pitches you something groundbreaking done by AI.

  • by profstasiak on 6/3/25, 6:03 PM

    many such cases

  • by moralestapia on 6/3/25, 9:59 PM

    The elephant in the room is how many builder.ai(s) are still out there.

    My personal estimate is that it is about 80% of the startups you see around.

  • by xyst on 6/3/25, 9:02 PM

    The Theranos of AI. What a joke.

  • by Yeul on 6/3/25, 9:48 PM

    Honestly I feel bad for Indians but yeah everything annoying comes from them. Scamming, call centers and worst of all Microsoft agents.

  • by pkkkzip on 6/3/25, 7:10 PM

    Definitely not helping stereotypes

  • by stuartd on 6/4/25, 1:23 AM

    cowboys

  • by mountainriver on 6/3/25, 4:59 PM

    Do folks think that this was utter negligence by the VCs, or just a pump and dump?

  • by andrewinardeer on 6/3/25, 7:01 PM

    AI = Actual Indians, apparently.

  • by felineflock on 6/3/25, 7:32 PM

    Not to confuse with builder.IO - poor founder was posting these days "FOR THE LAST TIME GUYS THIS IS A DIFFERENT COMPANY".

  • by zachncst on 6/3/25, 8:09 PM

    Isn’t this what they always tell startups to do? Fake it and get product market fit. I recall the stories of task rabbit where the founder was delivering all the meals.

  • by rdtsc on 6/3/25, 7:30 PM

    > Linas Beliūnas, Director of the financial company Zero Hash, recently exposed that Builder.ai lacked true AI, instead utilising a group of Indian developers who were merely pretending to be bots writing code.

    They probably had to train people to talk like ChatGPT.

    Step 0: Make sure you have an em dash shortcut on your keyboard and use that as often as possible.

    Step 1: Be extremely polite and apologize profusely.

    Step 2: ...

  • by koakuma-chan on 6/3/25, 7:46 PM

    Oh no, qwik was my favourite JavaScript framework