Manus Raises $500M After China Blocked Meta's $2B Deal

Manus, the AI agent startup Meta tried to buy for roughly $2 billion, has raised more than $500 million in its first funding round since Beijing forced that deal apart. The round, announced October 8, 2026 by parent company Butterfly Effect, came without a confirmed valuation, even though earlier press reports had pointed to a $4 billion target.

What Manus just raised, and from whom

Chinese AI lab Manus's parent company, Butterfly Effect, said on Thursday in a WeChat post that it has raised more than $500 million, the company's first funding round since Meta was forced to call off its $2 billion acquisition of the startup. Boyu Capital and IDG Capital led the funding round, and existing shareholders Tencent, HSG (formerly known as Sequoia China), ZhenFund, and others also participated, according to TechCrunch's reporting on the WeChat announcement.

Some aggregated headlines described the round as "led by Tencent," but that characterization does not match the primary reporting on Butterfly Effect's own statement. Both CNBC and TechCrunch, citing the company's Thursday announcement, say the round was led by Boyu Capital and IDG Capital, with Tencent, HSG and ZhenFund participating only as existing shareholders making follow-on investments.

The company did not disclose its post-funding valuation. Bloomberg reported last month that Manus was set to double its valuation to $4 billion in this financing round, making it the country's most valuable AI agent maker. That figure has not been confirmed by Butterfly Effect itself. A separate account of the deal, carried by AI-industry newsletter AI Weekly citing TechNode, reported that CATL, China's dominant electric-vehicle battery maker, joined the round as a new investor, extending industrial capital into AI-agent bets beyond dedicated tech funds.

Dan Wang, China director at Eurasia Group, told CNBC that "the fundraising shows that the short-term fallout of the Meta case has been contained and investors are willing to back Manus as an independent company."

How a $2 billion Meta deal became a Beijing veto

The roots of this story go back to December 2025. Founded in 2022 by a team of Chinese engineers, Manus relocated its headquarters from China to Singapore around mid-2025, and just months later Meta came knocking, announcing its acquisition of Manus in December 2025 for roughly $2 billion to $3 billion, with plans to fold its agent technology directly into Meta AI.

The deal did not survive regulatory scrutiny. In January, just days after Meta and Manus announced the deal, Chinese officials began investigating the acquisition for potential national security issues and export control violations, and last month China barred the founders of the AI startup from leaving the country as the deal was being probed on national security grounds.

On April 27, 2026, China's state planner, the National Development and Reform Commission, called for Meta to unwind its $2 billion acquisition of Manus, with the decision to prohibit foreign investment in Manus made in accordance with laws and regulations, and the NDRC saying it had asked the parties involved to withdraw the acquisition transaction. The wording of that order, demanding the companies "unwind" rather than simply cancel the transaction, indicates the deal had already closed or was in an advanced stage of integration when Beijing intervened, not that it was stopped before signing.

The market's reaction to the block was muted. Shares of Meta closed 0.53% higher on the day the NDRC announced its decision, consistent with a deal that, however unusual the geopolitics, represented a small fraction of Meta's overall business.

What's confirmed, what's not, and what it means for readers

Two separate numbers are circulating around this story, and they measure different things. The $500 million is new cash that investors put into the company; it is the size of the financing round. The $4 billion figure, by contrast, is a reported implied value for the entire company, the kind of number used to calculate how much of Manus new investors now own. Butterfly Effect has confirmed the first number and not the second, so readers should treat the $4 billion figure as a press-reported target rather than a disclosed fact.

The regulatory story also has layers that are easy to collapse into one event. There was the signing of Meta's acquisition in December 2025, a Chinese investigation opened the following month on national-security and export-control grounds, an exit ban on the founders reported in March, and finally the NDRC's formal order on April 27 to unwind the transaction. Each step represents a different kind of government action, and only the last one is a completed regulatory decision rather than an ongoing inquiry.

What remains unknown from the sources reviewed here is how much money, if any, changed hands between Meta and Manus's founders before the deal was unwound, and what it cost either side to reverse the transaction. None of the reporting found establishes the financial terms of the unwind itself, only that regulators ordered it and that Manus has since completed an independent funding round. The AI Weekly account, citing TechNode, also reported that the new $4 billion figure would be roughly double the price at which Manus's founding team bought back their shares from Meta, but that claim has not been independently verified against a primary document and should be read as one outlet's unconfirmed characterization.