AI Startup Manus Secures Over $500 Million in Funding Amidst Regulatory Scrutiny

AI startup Manus has secured over $500 million in new funding, a development that follows a previously agreed-upon acquisition by Meta that was ultimately blocked by Chinese regulators. The funding round was led by Boyu Capital and IDG Capital, with participation from existing backers including Tencent, HSG, and ZhenFund.

Manus’s journey has been marked by rapid growth and significant regulatory hurdles. The company launched in March 2025, offering AI agents designed to perform tasks autonomously. Within eight months, by December 2025, Manus reported reaching $100 million in annual recurring revenue. This rapid ascent attracted the attention of Meta, which announced in December 2025 its intention to acquire Manus for approximately $2 billion.

However, the proposed acquisition faced scrutiny from Chinese authorities. In January, China’s commerce ministry indicated it would assess the deal. By March 2025, Manus co-founders Xiao Hong and Ji Yichao were reportedly summoned to Beijing and barred from leaving the country, according to Reuters. Subsequently, on April 27, China’s National Development and Reform Commission ordered the deal withdrawn, stating it would “prohibit foreign investment in Manus in accordance with laws and regulations.” Meta officially cut ties with Manus in June.

Following the failed acquisition, Manus announced in August 2025 that it would operate independently again. As part of this separation, the company deleted some user data created on or after December 29, 2025, to disentangle its systems from Meta’s. Manus plans to utilize the new funding for hiring and expansion, though the specific valuation of this latest funding round remains uncertain.

The company’s parent entity is Butterfly Effect, and its team relocated to Singapore around mid-2025, leading to the shutdown of most of its China operations and dozens of employee layoffs in July. Manus’s technology reportedly utilizes Anthropic’s Claude and fine-tuned versions of Alibaba’s Qwen models, alongside its own developments. The company also offers Cue, an app that provides AI agents with dedicated phone numbers and digital wallets, subject to user-set budgets.

This situation unfolds against a backdrop of increasing geopolitical influence on the AI sector. In May 2025, China required some senior AI workers at private firms, including Alibaba and DeepSeek, to obtain approval before traveling abroad. This move, alongside the Manus deal blockage, signals Beijing’s growing efforts to control the development and international collaboration within its advanced AI industry. Meta, meanwhile, launched its own coding agent, Muse Code, in August 2025. The high demand for Manus’s early access, with invite codes reportedly reselling for up to 10 million yuan (over $1.3 million), indicates significant market interest in advanced AI agent technology. Manus’s ability to secure substantial new funding after navigating these complex regulatory and market dynamics underscores the continued investor confidence in the AI agent space, despite the inherent geopolitical risks.

Why This Matters

The materials describe a narrow update: Manus, an AI agent startup, raised over $500 million in new funding. The exact valuation of Manus in the latest funding round.

Broader Context

Source materials place the factual news in this context: 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.