AI Startup Manus Raises $500 Million After China Nixed Meta’s $2 Billion Acquisition

Manus, the AI agent startup that Meta bought for about $2 billion before China forced Meta to give it back, has raised more than $500 million in fresh funding.

Its parent company, Butterfly Effect, confirmed the round in a WeChat post, with Boyu Capital and IDG Capital leading and existing backers Tencent, HSG (the firm formerly known as Sequoia China) and ZhenFund joining.

The company did not say how it will spend the money, only that it plans to keep hiring in China and abroad. Butterfly Effect also did not disclose a valuation, but Bloomberg previously reported it was eyeing a $500 million raise at a $4 billion valuation, roughly double what Meta agreed to pay.

Manus makes AI agents, software that doesn't just answer questions like a chatbot but takes a goal and carries it out on its own, from booking trips to analyzing stocks. When it launched in March 2025, it sold as a Chinese rival to OpenAI's $200-a-month agent, open by invitation only.

Demand was frantic: invite codes were reportedly listed on a Chinese resale marketplace for as much as 10 million yuan, over $1.3 million. Under the hood, the company acknowledged it used Anthropic's Claude and fine-tuned versions of Alibaba's Qwen models alongside its own.

But still, these were times when agentic AI wasn't really a big deal. Manus was experimenting with that use case before the AI behemoths started working on it.

Manus moved its team to Singapore around mid-2025, shutting most of its China operations and laying off dozens of employees in July.

By December it had reached $100 million in annual recurring revenue, the yearly total of its subscriptions, about eight months after launch. Meta announced that same month that it would buy Manus for roughly $2 billion.

Attention, meanwhile, drifted to OpenClaw, an open-source agent that runs on your own machine and takes orders through apps like WhatsApp and Telegram. OpenClaw collected well over 100,000 GitHub stars, which are developer bookmarks, within weeks of going viral.

OpenAI then hired OpenClaw's creator, Peter Steinberger, to lead its push into personal agents.
OpenAI Taps OpenClaw Founder to Lead Push Into Personal AI Agents

China's commerce ministry said in January it would assess the Manus deal, and by March co-founders Xiao Hong and Ji Yichao had been summoned to Beijing and barred from leaving the country, per Reuters. On April 27, the National Development and Reform Commission, China's top economic planning agency, ordered the deal withdrawn and said it would "prohibit foreign investment in Manus in accordance with laws and regulations."

Meta cut ties in June. In August, Manus announced it would operate independently again, deleting some user data created on or after December 29, 2025, to separate its systems from Meta's.

Meta's own coding agent, Muse Code, launched that same month into a market where it felt late to the fight against Codex and Claude Code. Manus, for its part, now sells Cue, an app that gives agents their own phone numbers and digital wallets, with payments limited to a budget the user sets.

The Manus case sits inside a wider tightening in Beijing: in May, China required some senior AI workers at private firms, including Alibaba and DeepSeek, to get approval before traveling abroad, as Chinese AI approaches levels of quality and relevance that can compete head to head against American companies.

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