Manus Secures Over $500 Million in New Funding Following Aborted $2 Billion Meta Acquisition

Manus, the pioneering AI agent startup that was briefly acquired by Meta before being forced to separate due to regulatory intervention from Beijing, has successfully closed a massive new funding round. The company has raised more than $500 million in fresh capital as it looks to reassert its independence and accelerate its global ambitions in the competitive artificial intelligence market.

The startup’s parent company, Butterfly Effect, officially confirmed the capital injection through a detailed post on WeChat. The high-profile funding round was co-led by prominent investment institutions Boyu Capital and IDG Capital. They were joined by a robust roster of existing backers, including tech giant Tencent, HSG (the investment firm formerly known as Sequoia China), and early-stage venture capital firm ZhenFund.

While the company elected not to explicitly detail the exact allocation of the new funds, Butterfly Effect indicated that the capital will be deployed to support ongoing aggressive hiring initiatives both within mainland China and across international markets. Although Butterfly Effect did not publicly disclose the official valuation attached to this latest financing event, Bloomberg previously reported that the startup was targeting a $500 million raise at a lofty $4 billion valuation. That figure represents roughly double the financial terms of the aborted acquisition agreement previously struck with Meta.

The Rise of Autonomous AI Agents

Manus specializes in the development of sophisticated AI agents—advanced software systems designed to transcend the traditional capabilities of conversational chatbots. Rather than merely generating text responses to user prompts, these agents are engineered to receive a high-level goal and autonomously execute complex multi-step workflows, ranging from booking comprehensive travel itineraries to conducting intricate stock market analyses.

When the platform initially launched in March 2025, it was positioned directly as a formidable Chinese contender against OpenAI’s high-priced, invitation-only agent services. Initial demand for the product was exceptionally frantic and characterized by intense speculation. Invite codes for the platform were reportedly listed on domestic Chinese resale marketplaces for staggering sums, with some changing hands for as much as 10 million yuan, equivalent to over $1.3 million.

Beneath the surface, the company leveraged a combination of foundational technologies. Manus acknowledged that its underlying architecture utilized Anthropic’s Claude alongside heavily fine-tuned iterations of Alibaba’s Qwen models, seamlessly integrated with its own proprietary systems. At the time of its debut, the concept of advanced agentic AI had not yet captured the mainstream collective consciousness to the extent it eventually did. Manus was effectively pioneering a critical use case well before the broader global technology behemoths fully pivoted their engineering focus toward autonomous agents.

Rapid Growth and the Meta Acquisition

As momentum built around its software, Manus executed strategic structural shifts. The company relocated its core team to Singapore around the middle of 2025, winding down the majority of its physical operations inside mainland China and carrying out a round of layoffs affecting dozens of employees that July.

Despite these operational adjustments, the commercial traction was undeniable. By December 2025—roughly eight months after its initial market introduction—Manus crossed the significant milestone of $100 million in annual recurring revenue, reflecting the powerful yearly accumulation of its subscription model. Recognizing this rapid trajectory, Meta made a dramatic move, announcing that same month that it had agreed to acquire Manus for approximately $2 billion.

The competitive landscape for AI agents, however, was shifting rapidly beneath their feet. Industry attention quickly drifted toward OpenClaw, a disruptive open-source agent designed to operate locally on a user’s personal machine while accepting instructions through consumer messaging applications like WhatsApp and Telegram. OpenClaw achieved viral status within the developer community, amassing well over 100,000 GitHub stars in a matter of weeks. The momentum culminated when OpenAI aggressively moved to hire OpenClaw’s creator, Peter Steinberger, to spearhead its own internal push into the personal agent ecosystem.

Regulatory Interventions and Market Re-entry

For Manus, the path forward hit a sudden and insurmountable regulatory wall in early 2026. In January, China’s Ministry of Commerce announced that it would closely review the proposed $2 billion Meta transaction. The situation escalated rapidly by March, when co-founders Xiao Hong and Ji Yichao were summoned to Beijing and reportedly barred from leaving the country, according to reporting by Reuters.

The regulatory hammer fell decisively on April 27, when the National Development and Reform Commission—China’s highest economic planning agency—formally ordered the acquisition to be undone. The agency stated that it would prohibit foreign investment in Manus in strict accordance with applicable national laws and regulations.

Complying with the mandate, Meta officially severed its ties with the startup in June. By August, Manus formally announced its return to independent operations. As part of the corporate unbundling, the company wiped user data created on or after December 29, 2025, to ensure a clean technological and operational separation from Meta’s infrastructure.

Since returning to the market independently, Manus has continued to roll out new consumer-facing products. The firm currently markets Cue, a specialized application that provides individual AI agents with dedicated phone numbers and secure digital wallets, constrained strictly by user-defined budgetary limits. Meanwhile, Meta launched its own proprietary coding agent, Muse Code, in August 2026, entering a fiercely contested market where critics argued it arrived late to challenge established alternatives like Codex and Claude Code.

The high-stakes saga surrounding Manus unfolds against a backdrop of tightening regulatory scrutiny by Beijing over the nation’s elite technology workforce. In May, China instituted strict new travel restriction policies requiring senior artificial intelligence researchers and engineers employed at prominent private firms, including Alibaba and DeepSeek, to secure formal government approval prior to traveling abroad. This policy shift underscores the immense strategic value placed on domestic AI talent as Chinese companies achieve technological parity and compete directly on the global stage against American industry leaders.