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Microsoft-backed UK tech unicorn Builder.ai collapses into insolvency

Builder.ai, a Microsoft-backed UK AI startup, entered insolvency proceedings in May 2025 after financial struggles became insurmountable.
The company faced a 25% revenue decline in late 2024 and disclosed inflated sales figures that misled investors, prompting leadership changes.
Builder.ai had raised over $450 million aiming to simplify app development with AI but relied heavily on human engineers and faced mounting criticism.
Builder.ai stated that it could not overcome longstanding difficulties and earlier choices that heavily impacted its financial stability.
The insolvency signals risks in backing AI startups and highlights issues in AI coding practices despite strong investor support and rapid growth ambitions.

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Financial Express

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