AI startup Manus raises $500 million after China blocks Meta’s $2 billion acquisition

Manus, the AI agent startup whose $2 billion acquisition by Meta was blocked by Chinese regulators, has raised more than $500 million in fresh funding, marking a remarkable comeback just weeks after the company returned to independent operations.

The funding gives Manus a second chance to build its business outside Meta, following one of the most unusual reversals of a major AI acquisition. It signals that investors still see enormous potential in autonomous AI agents, despite growing competition from technology giants and mounting tensions between Washington and Beijing.

Manus’ parent company, Butterfly Effect, announced Thursday that private equity firm Boyu Capital and venture investor IDG Capital led the financing, CNBC reported. Existing investors Tencent, HSG Capital, and ZhenFund participated in the round.

The company did not disclose its valuation. Bloomberg previously reported that Manus was seeking a valuation of roughly $4 billion, double the price Meta agreed to pay when it announced the acquisition in December 2025. That would place Manus among the most valuable AI agent startups to emerge from China.

The new financing comes after Beijing ordered Meta to reverse the acquisition in April, forcing the companies to separate after Meta had already begun integrating Manus’ engineers and technology into its AI operations.

“The fundraising shows that the short-term fallout of the Meta case has been contained and investors are willing to back Manus as an independent company,” said Dan Wang, China director at Eurasia Group, also noting the renewed confidence in the commercial potential of AI agents.

The investment reflects a broader bet that AI agents capable of completing tasks, rather than simply answering questions, could become a major software category.

From Meta’s $2 Billion Acquisition to a $500 Million Comeback

Manus attracted global attention in early 2025 with an AI agent that can conduct research, create reports, build websites, and complete multi-step tasks with limited human supervision.

Founded in China, the startup later moved its headquarters and staff to Singapore, attracting investment from U.S. venture firm Benchmark. Its international ambitions appeared to pay off when Meta announced plans to acquire the company for roughly $2 billion in December.

That deal quickly became a test of China’s willingness to let domestic AI technology fall under American ownership.

In April 2026, Chinese authorities intervened, ordering the transaction reversed. The National Development and Reform Commission said it had decided to “prohibit foreign investment in the Manus project.”

The decision left Manus’s future uncertain. Its original investors eventually bought back Meta’s shares, clearing the way for the startup to operate independently again.

Yet Manus was far from standing still.

In June, The Information reported that the company’s annualized revenue run rate had climbed to between $400 million and $500 million, compared with roughly $100 million in December. Those figures represented revenue at its then-current pace, not audited annual sales.

Since separating from Meta, Manus has introduced Manus 2.0, built around its proprietary Cascade execution system. It has launched Cue, a standalone personal AI agent app that gives individual agents their own email addresses, phone numbers, and mobile wallets.

The timing places Manus in direct competition with Meta, which launched its Muse personal AI agent in September, and other companies seeking to turn AI assistants into products that handle everyday work.

Manus may eventually pursue a public listing, potentially in Hong Kong. For now, the challenge is to show its business can grow profitably without running into new regulatory obstacles.

“The immediate task for Manus now is proving scale, profitability and regulatory alignment,” said Han Lin, China country director at The Asia Group.

For the broader startup industry, the Manus saga raises a larger question: Can Chinese-founded AI companies compete globally without getting caught between two governments increasingly determined to control strategically important technologies?

Manus has already lost one multibillion-dollar exit. Its investors are betting that independence could still produce an equally valuable business.

Manus Founder