In 2016, British-Indian entrepreneur Sachin Duggal founded Builder.ai, an ambitious startup backed by prominent investors like Microsoft and Qatar Investment Fund. With a total investment of around USD 445 million, Builder.ai was headquartered in London, operating across Delhi, Bengaluru, Singapore, Tokyo, Dubai, and Los Angeles.
The company claimed to generate code for apps and websites using artificial intelligence (AI), a boast that once valued the company at USD 1.5 billion. However, in May 2025, then-CEO Manpreet Ratia surprisingly announced Builder.ai was heading toward bankruptcy.
Numerous Questions Emerge
Following this announcement, major questions arose: Where did such a large investment go? What were the company's earnings? What was the truth behind the business between Builder.ai and Indian company VerSe? Questions swirled amidst accusations of high billing, human work billed as AI, and fraudulent invoicing. Some early investors, amid these allegations, hired Mumbai forensic firm MZM Analytics for investigation.
What Does the Forensic Report Reveal?
According to an exclusive forensic report obtained by India Today TV, there was indeed legitimate business between Builder.ai and VerSe. The report scrutinized over 13,000 messages, contracts, dashboards, screenshots, and third-party audit documents.
The report confirmed the JoshFan app was genuinely created. Advertising campaigns took place on Dailyhunt, and work related to software and licensing was undertaken, with signed agreements and delivery records as proof. Hence, asserting no real business took place between the two companies is entirely incorrect, challenging the credibility of 'round-tripping' accusations—referring to transactions fabricated on paper only.
...However, There Were Accounting Discrepancies
The report also clarifies that company accounting was not entirely accurate. It raises the question: with such operational evidence, how did opposing narratives gain such firm belief in major media outlets without documentation?
Major Governance Issues Within the Company
MZM Analytics' investigation uncovered significant governance issues in Builder.ai. The lines of oversight and control were blurred. An investor-appointed board observer, lacking any formal authority, deeply involved themselves in crucial company decisions, including revenue, audit responses, and staffing matters.
In a WhatsApp message, they commented on a USD 7 million revenue gap for Q2-24, which typically falls under a CFO's domain. This undermines the notion that management alone was responsible while investors were entirely unaware.
Internal Investigation Also Questioned
Builder.ai's audit committee's internal investigation, conducted by MZM, was also deemed incomplete. According to the report, many conclusions were drawn without solid evidence. 67 GB of data was found, yet a time constraint prevented a comprehensive review, and there was no dialogue with VerSe representatives or auditors from both companies.
The Real Reason: Hidden Liabilities
The forensic report indicates that VerSe wasn't the reason for Builder.ai's downfall, but rather liabilities with Talkdesk, known to the new CEO in December 2024. Despite this, the information was not disclosed to investors and creditors for months. This delayed disclosure violated debt agreements, allowing creditors to withdraw from the company's accounts, ultimately leading to its sudden collapse.
Investment Allocation – Report
Operations Research and Development Employee Salaries Vendors Cloud Infrastructure (No evidence of fraud or private misuse surfaced.)
Key Comment from the Delhi High Court
On December 26, the Delhi High Court lifted the non-bailable warrant issued against Builder.ai founder Sachin Duggal, stating that imposing harsh actions before concluding the investigation violates legal protocols. Duggal was recognized only as a witness, not as an accused.
This entire narrative clarifies that Builder.ai's collapse isn't merely about AI or fraudulent billing. It's a consequence of poor governance, delayed liabilities, and misjudgments. The biggest question remains: with such complexity, how did a one-sided narrative so swiftly dominate?
