Builder.ai’s collapse didn’t kill the dream—it made room for India’s new vibe coders
- Indian vibe coding startups like Emergent, Rocket, and Composio have raised $15-25 million each, marking a rebound after three slow years and Builder.ai’s collapse.
- Investors see promise in AI-powered app builders, though doubts linger over scalability and real-world use.
The resurgent buzz around vibe coding has allowed Indian startups developing these AI platforms to command larger cheques than the typical $1-10 million flowing into early stage fundraising deals.
Indian vibe coding startups Rocket, Emergent and Composio have raised between $15 million and $25 million this year, reviving investor interest in the space following the collapse of no-code platform Builder.ai.
Vibe coding is a blend of artificial intelligence with traditional development tools for software engineers. The selling point, according to vibe coding platforms, is that they allow even users without coding knowledge to create apps by typing in prompts. The technology simplifies workflows with AI suggestions, code generation, and task automation.
Emergent Labs, founded by now defunct Dunzo’s cofounder and chief technology officer Mukund Jha and his brother Madhav in August last year, on Wednesday raised $23 million in a Series A fundraising round led by Lightspeed Venture Partners. Series A marks the first round of institutional investment in a startup following seed funding.
The other investors were US-based startup accelerator and venture capital firm Y Combinator, the Netherlands-based Prosus Ventures, and Bengaluru-based Together Fund.
Emergent, which previously raised $7 million in seed funding, says it hit $15 million in annual recurring revenue in its first three months since the platform's launch in July, and that 1.5 million users have built over 2 million apps using the platform. Emergent’s pricing ranges from $17 to $250 per month.
“Most platforms stop at a prototype. We give users a fully production ready app. We are seeing a lot of people come in and build on our platform and launch them," said Mukund Jha.
On Tuesday, Rocket.new announced raising $15 million in seed funding co-led by Salesforce Ventures and Accel, with participation from Together Fund. That’s the third-largest seed round so far this year, behind electric vehicle startup EKA Mobility’s $23.7 million fundraise in June and RackBank DataCenter’s $16.5 million in March.
Rocket co-founder and chief executive Vishal Virani had previously raised nearly $10 million from Accel, India Quotient, and Angel List for Surat-based DhiWise, which was started in 2021. DhiWise will now become the parent company, with shareholders like Indian Quotient and Accel retaining their original holding in the company.
“Right now, our entire strategy is to focus on being product-led," said Virani. “Over time, our revenue mix is going to be a mix of enterprise plus individual users."
Rocket offers a free starter model, with subscriptions ranging from $25 to $100 per month. But according to Virani, the company has seen users—typically employees of another business—spending upwards of $4,000 a month.
Targeting large businesses is encoded in the startup’s roadmap, said Virani. “We want to target decision makers and ultimately have them use the product. Right now, we’re trying to bridge the gap between the user persona and the buyer persona in enterprise so we can make our sales cycles faster."
Rocket aims to scale up its annual recurring revenue from $4.5 million now to $25 million by the end of the year.
In July, vibe coding agentic AI platform Composio raised $25 million in a Series A fundraising round led by Lightspeed with participation from Elevation Capital and Together Fund. Composio, too, offers a free-to-use model, charging $29 and $229 per month for more advanced plans.
Other noteworthy deals involving vibe coding startups this year include Prosus Ventures and Accel's $2.5 million pre-seed investment in CodeKarma, Stellaris Venture Partners’ $2.7 million cheque to Drizz, and Titan Capital backing Haizen with $500,000.
- After three slow years and the collapse of Builder.ai, Indian vibe coding startups such as Emergent, Rocket, and Composio are attracting larger fundraising rounds, with $15-25 million deals signaling revived investor confidence.
- These AI-powered platforms aim to simplify app development by letting even non-coders build production-ready applications using text prompts, positioning themselves as tools to streamline workflows and expand access to software creation.
- While early traction and revenue growth are promising, skepticism remains around vibe coding’s scalability, security, and enterprise adoption—especially as deep-pocketed US rivals aggressively push into India with lower pricing.
Vibe coding: Still starting
Investments into vibe coding platforms had peaked in 2022 and 2023 when now bankrupt Builder.ai raised a total of $350 million over the two years.
Builder.ai, which was based in London and founded by British-Indian entrepreneur Sachin Dev Duggal, filed for insolvency in May following allegations of exaggerated AI claims and financial misreporting.
While funding into Indian vibe coding startups has been slow, the picture in the US is starkly different.
Foster City, California-based AI-powered app builder Replit just closed a $250 million Series E fundraise led by Prysm Capital, with participation from Amex Ventures, Google’s AI Futures Fund, Y Combinator, and Andreessen Horowitz.
The nearly decade-old company is currently valued at $3 billion and has seen its annualised revenue grow from $2.8 million to $150 in under a year.
San Francisco-based vibe coding platform Cursor raised $900 million in a Series C round in June led by Thrive, Accel, Andreessen Horowitz, and DST, valuing the company at nearly $10 billion.
While investor interest in Indian vibe coding startups has accelerated in recent months, some view this shift with skepticism.
“These early-stage rounds suggest that real differentiation is economically possible, but [vibe coding’s] technical feasibility remains to be seen at a larger peer-to-peer scale for foundational coding in a system," said Abhivardhan, president, Indian Society of Artificial Intelligence and Law, an industry forum. “Honestly, the practical applications remain quite limited."
Serious business applications typically require architecture, security protocols, and scalability that vibe coding simply cannot handle reliably, he explained.
Add to that, complex systems need human experts who understand trade-offs and scalability patterns, and can make strategic technical decisions. “Vibe coding works for the surface, not the foundation," added Abhivardhan, who goes by his first name.
Where vibe coding might shine, though, is in accessibility.
“Screen reader users, who once had to navigate code line by line, are emerging as some of the most enthusiastic adopters of AI coding assistants," said Sohom Banerjee, senior research associate at CUTS International, a policy research and advocacy group.
But other challenges remain—AI-generated code is not always accessible by default, and large volumes of suggestions can be overwhelming. Moreover, entrenched US rivals might be able to push into markets harder than Indian startups.
“Big Tech is pushing aggressively into India with ultra-low pricing—an ‘AI dumping’ play that can suffocate local challengers before they scale," said Banerjee. “And the ecosystem has cautionary tales: over-promise/under-built ‘AI’ damages trust."
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