London based Builder.ai, a prominent AI startup known for its no code platform that streamlines app development, has officially entered insolvency proceedings due to significant financial challenges.
The company, once valued at $1.3 billion and backed by heavyweight investors including Microsoft and Qatar’s sovereign wealth fund, faced mounting debts and cash flow problems that it could no longer manage.
Builder.ai Struggles with Massive Debts, Files for Insolvency
Recent internal audits revealed financial irregularities, including misstated revenues and a sharp decline in expected income for 2024.
As a result, leadership changes were made, with new executives stepping in to oversee a restructuring process.
Builder.ai reportedly owes over $85 million to Amazon Web Services and about $30 million to Microsoft, adding to the pressure on its finances.
The insolvency filing aims to protect the company while administrators work on strategies to stabilize operations and potentially salvage viable parts of the business.
Despite this setback, Builder.ai has pledged to support its employees and maintain services for its customers throughout the process.
This development highlights the tough realities of scaling a tech startup, even with significant funding, and underscores the importance of solid financial oversight in the fast-moving AI sector.
