AI Startup Builder.ai Faked Revenue Deal With India's VerSe Innovation
The startup revealed plans to file for insolvency in May after lenders froze its funds.
Builder.ai, a London-based AI startup that has filed for insolvency, inflated sales figures through dubious transactions with Indian social media firm VerSe Innovation, the parent of DailyHunt.
According to Bloomberg, the two companies engaged in “round-tripping” — billing each other for nearly identical amounts without actual services exchanged — to artificially boost revenues and attract investors.
Builder.ai, known for its no-code app development platform, revealed plans to file for insolvency in May after lenders froze its funds. VerSe has denied the allegations, calling them “baseless.”
Over four years, Builder.ai reportedly booked nearly $60 million in revenue from VerSe, while transferring similar sums back for services like marketing.
The scandal has raised concerns over governance in the AI startup space, especially as Builder.ai counted high-profile backers like Microsoft and QIA. VerSe is backed by Google and Goldman Sachs.