Manus, the AI-agent developer that was briefly owned by Meta, announced that its holding company, Butterfly Effect, secured a financing round exceeding $500 million. The round was headed by Boyu Capital and IDG Capital, while existing investors Tencent, HSG (formerly Sequoia China) and ZhenFund also participated. No valuation was disclosed, though earlier Bloomberg reporting suggested the company might be targeting a $4 billion valuation, roughly double the price Meta had agreed to pay.
Business performance and product offering
Eight months after its March 2025 launch, Manus reported $100 million in annual recurring revenue, reflecting subscription sales of its AI-agent platform. The service differentiates itself from conventional chatbots by accepting a user-defined objective and executing the task autonomously, such as booking travel or conducting stock analysis. Technically, Manus incorporates Anthropic’s Claude model, fine-tuned versions of Alibaba’s Qwen models, and proprietary components. Early demand was intense; invitation codes were reportedly listed for as much as 10 million yuan (about $1.3 million) on secondary marketplaces.
Regulatory backdrop and operational shifts
Meta’s plan to acquire Manus for roughly $2 billion was announced in December 2025. However, China’s National Development and Reform Commission ordered the transaction to be undone on April 27, citing foreign-investment restrictions. Prior to that, co-founders Xiao Hong and Ji Yichao were summoned by authorities and barred from leaving the country. Meta terminated the deal in June, and in August Manus resumed independent operations, deleting user data generated after December 29, 2025 to separate its systems from Meta’s.
Following the regulatory intervention, Manus relocated most of its staff to Singapore in mid-2025 and reduced its China workforce, laying off dozens of employees in July. The company now markets an app called Cue, which assigns each AI agent a phone number and a digital wallet, with spending limited by a user-set budget.
Future outlook
The fresh capital will be used to continue hiring both in China and abroad, though specific allocations were not disclosed. The funding positions Manus to expand its agent-centric services amid growing competition from major AI players that are also developing personal-assistant capabilities. At the same time, Beijing’s tightening of AI-related foreign investment and travel approvals for senior AI staff signals a more constrained operating environment for domestic AI firms seeking global partnerships.
Why it matters
Manus’ ability to attract a half-billion-dollar infusion despite a high-profile deal being blocked underscores investor confidence in agent-based AI applications. The company’s rapid revenue growth and product differentiation illustrate a market appetite for autonomous AI assistants beyond simple chat interfaces. Finally, the episode highlights the influence of Chinese regulatory policy on cross-border tech transactions, shaping the strategic choices of both domestic innovators and multinational acquirers.
