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What Happened to Builder.ai? A Breakdown for Startup Founders

26 May 2025

Builder.ai crashing
Builder.ai Crash

“We were in the middle of a sprint when we saw the headline: Builder.ai bankrupt.” 

Thousands of startups that trusted Builder.ai woke up to news no product team wants to hear, their app development partner had collapsed. 

What followed was confusion, panic, and for many, total code lockdown. In this blog, we break down what happened, why it matters, and what steps you need to take right now if Builder.ai was powering your app. 

The Timeline: From Unicorn to Collapse 

In 2023, Builder.ai was riding high. Backed by Microsoft, the platform promised a revolutionary “AI-powered app builder.” It raised over $250 million and positioned itself as a no-code dream for non-technical founders. 

But behind the scenes, the numbers didn’t add up. In early 2025, CEO Manpreet Ratia and founder Sachin Dev Duggal came under scrutiny when revenue numbers were allegedly overstated by over $100 million. 

By May 2025, Builder.ai had filed for insolvency. Clients were locked out. Projects were paused. Engineers disappeared. 

What Does This mean for Existing Customers? 

If you were using Builder.ai, you’re likely facing one (or more) of these: 

  • No access to source code. 
  • Support channels are down.
  • Roadmaps on hold. 
  • Investor pressure to recover. 

It’s not just an operational nightmare. It’s a trust breakdown. 

Builder.ai’s model locked clients into a proprietary system with little transparency. Now that the company has folded, those choices are hurting founders where it matters most: time, trust, and control. 

Why Founders Must Rethink “AI-Led” Development? 

Builder.ai sold simplicity. But what startups needed was ownership. True software development, which scales, pivots, and lasts, requires human alignment, code transparency, and accountable execution. 

Platforms built on buzzwords can deliver fast demos, but when real engineering decisions show up, AI can’t act like a CTO. 

What to Do Now? The First 3 Steps 

  • Secure your data and assets.

If you can access any portion of your codebase or assets, back them up.

  • Rebuild with control.

Look for dev partners that guarantee code ownership, source control access, and transparent billing.

  • Don’t go it alone.

At HireDeveloper.Dev, we’re helping Builder.ai clients recover quickly with real human teams that integrate into your workflow.

It Wasn’t Just a Platform Failure. It Was a Trust Failure. 

If you’re a founder, this wasn’t just a product collapse. It was a business risk realised. At HireDeveloper.Dev, we work differently. You don’t have access. You build with us, and you own what we create together. 

Need help switching from Builder.ai? Let’s talk! Free consultation for affected startups. Book a time!

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    frequently asked Questions
    Why Did Builder.Ai Shut Down?

    Builder.ai filed for insolvency in May 2025 after reports of financial misreporting and investor fallout. Key issues included overstatement of revenue, lack of code access for clients, and operational instability.

    Is Builder.Ai Still Operating?

    As of now, Builder.ai has ceased core operations and appointed administrators to handle insolvency. Active development and client support appear to have halted entirely.

    What Happens to Projects Built on Builder.Ai?

    Most Builder.ai customers have lost access to their source code and development support. If your app was hosted or maintained by Builder.ai, there’s a high chance your project is now frozen.

    Can I Retrieve My Data or Code from Builder.Ai?

    Unless you were given GitHub or server access before the shutdown, it may be difficult to retrieve your project assets. It's advised to contact any former point of contact or initiate a legal review of your agreement.

    What are the Risks of Working with Proprietary Platforms like Builder.Ai?

    Proprietary platforms can lock your project into their ecosystem, making it hard to extract your code or migrate if the vendor fails. Always ensure you maintain code access, IP rights, and control over your team.

    How Does HireDeveloper.Dev Protect Clients from these Risks?

    HireDeveloper.dev offers dedicated developers who integrate into your team. You own your code, manage your workflow, and have full visibility with no platform lock-ins or hidden layers.