Core Viewpoint - The article discusses the downfall of AI startup Builder, which filed for bankruptcy, marking the largest collapse among AI startups since the emergence of ChatGPT. The company, founded in 2016, was initially valued at $1.5 billion but was revealed to be a facade, relying on human programmers instead of AI technology [1][11]. Group 1: Company Background - Builder was founded by Sachin Dev Duggal in 2016, aiming to simplify software development through AI [2][4]. - The company gained significant attention and investment, including $295 million in Series A funding from notable investors like SoftBank and Microsoft [8][9]. - Builder's peak valuation reached approximately $1.5 billion, with total funding exceeding $450 million [9][12]. Group 2: Business Model and Operations - Builder marketed itself as a low-code/no-code platform, claiming to enhance application development speed by up to six times and reduce costs by 70% [6]. - The company introduced an AI product manager named Natasha, which was perceived as a pioneering AI tool in the industry [6][9]. Group 3: Financial Misrepresentation - Investigations revealed that Builder's revenue was significantly overstated, with claims of $220 million for 2024 being reduced to $55 million, representing a 300% overstatement [12][13]. - The company's actual revenue for 2023 was reported at $45 million, down from an initial claim of $180 million [12][13]. - Builder's financial troubles were exacerbated by a lack of genuine AI capabilities, relying instead on human labor to fulfill its promises [11][12]. Group 4: Consequences and Industry Implications - The bankruptcy of Builder serves as a cautionary tale for investors, particularly highlighting the risks associated with overvalued tech startups [1][17]. - The article reflects on the broader implications for the investment landscape, emphasizing the need for due diligence and skepticism in the face of inflated valuations and promises [16][17].