The AI agent startup Manus has completed its first funding round, raising over $500 million after Meta was forced to abandon its acquisition of the company.
On Thursday, Manus's parent company, Butterfly Effect, announced that this funding round was led by private equity firm Boyu Capital and venture capital firm IDG Capital, with existing shareholders Tencent, HSG, and ZhenFund participating.
The company did not disclose its post-funding valuation. Bloomberg reported last month that Manus is expected to double its valuation to $4 billion in this funding round, making it China’s most valuable AI agent manufacturer.
This funding round demonstrates that investors have not been deterred by Beijing’s unprecedented move to block Meta’s brief $2 billion acquisition attempt. Meta had been preparing to integrate Manus’s team and technology into its own systems, but regulators halted the deal. It also shows that, despite rapid advancements in underlying foundation models and intensifying price competition, interest in AI agent startups remains strong.
“This funding round shows that the short-term impact of the Meta incident has been contained, and investors are willing to support Manus as an independent company,” said Dan Wang, Head of China at Eurasia Group. He also noted that confidence in the commercial potential of AI agents is recovering.
Analysts say Manus may eventually seek an IPO, but its more urgent tasks are restructuring its business and equity structure to demonstrate profitability and comply with Beijing's regulatory requirements.
“Manus’s immediate priorities are to demonstrate scale, profitability, and regulatory compliance,” said Han Lin, head of China at The Asia Group.
Earlier this month, Manus stated that it has resumed independent operations following its spin-off from Meta, and the founding team will continue to drive the development of generative AI agents for global users.
Brief acquisition
Manus was once seen as a blueprint for Chinese startups seeking global expansion, but now it has become a cautionary tale for companies caught between regulators in Beijing and Washington.
The company launched in China in early 2025 and subsequently relocated its team to Singapore after receiving support from U.S. venture capital firm Benchmark. Meta announced its acquisition of the company in December. Chinese regulators subsequently halted the deal, with the National Development and Reform Commission stating it had decided to “prohibit foreign investment in the Manus project.” By that time, Meta had already begun integrating Manus’s team and technology into its own systems.
Since its spin-off, the AI startup has launched Manus 2.0, built on a new internal execution system called Cascade. It has also released Cue, a standalone personal agent app, where each agent has its own email address, phone number, and mobile wallet.
Meta is also developing its own personal AI agent, launching the Muse agent in early September, which is based on the open-source AI agent OpenClaw.
“The tight integration with Manus will not disappear after a transaction is reversed,” says Matthias Hendrichs, advisor at a global AI company in Singapore.
You can split a company, but you can't make engineers forget what they've learned.