Manus Raises Over $500M in First Round Since Meta Deal Collapsed

Butterfly Effect, the parent company of Chinese AI startup Manus, said on Thursday that it has raised more than $500 million — its first funding round since Chinese regulators forced the collapse of Meta's $2 billion acquisition of the company.

The company announced the round in a WeChat post. Boyu Capital and IDG Capital led the financing. Existing shareholders Tencent, HSG (formerly Sequoia China), ZhenFund and others also participated.

Butterfly Effect did not disclose the valuation attached to the round. Last month, the startup was reported to be in talks with investors to raise $500 million at a $4 billion valuation, according to a TechCrunch report. Manus did not respond to questions about its valuation.

Why did Manus need new money?

The round caps an unusually turbulent year for one of China's most visible AI startups. Manus went viral last year after a demo of its AI agent. In mid-2025 it relocated its staff to Singapore. That December, it agreed to a $2 billion acquisition by Meta. At the time, the startup was said to be generating more than $100 million in annual recurring revenue.

The deal did not survive regulatory scrutiny. In April, Chinese authorities ordered the startup to unwind the acquisition after a months-long probe, amid intensifying worries in China about losing AI talent and researchers to the West.

Manus resumed independent operations in August, following the end of the Meta deal. As part of the split, the company said it was required to delete some user data.

What will the funding pay for?

Hiring, for starters. The company said it will continue hiring both at home and abroad. The fresh capital also gives Manus runway to keep pace in a crowded market for AI coding and agent tools.

Manus makes AI products and agents similar to those offered by companies like Cursor, Lovable, and Replit. Its products include:

• a chatbot;
• vibe-coding tools that let users build apps and websites;
• tools for creating designs, presentations and generated video.

The company recently launched Manus 2.0, which it says brings a new architecture with new products and capabilities built around a new harness. It also introduced Cue, a standalone app that gives personal AI agents their own email addresses, phone numbers, digital wallets, and computers. The app lets agents communicate, handle tasks across services, and make payments within limits set by the user.

Is an IPO next?

The company is also reported to be considering going public in Hong Kong. If those plans advance, the new round would give Manus a stronger capital base and a fresh set of institutional backers — Boyu and IDG among them — ahead of a listing process.

The participation of Tencent, HSG and ZhenFund signals that Manus's earliest investors still see value in the standalone path after the failed $2 billion exit. The $4 billion valuation reportedly under discussion in September, if confirmed by the final terms, would value the startup at roughly 40 times the more than $100 million in annual recurring revenue it was pulling in when the Meta deal was signed.

For now, Manus is betting that independence, an overseas base in Singapore and aggressive hiring can restore the momentum it lost when regulators blocked its sale to Meta.