What is Manus, the AI startup being acquired for US$2 billion by Meta?

[SINGAPORE] Artificial intelligence (AI) startup Manus is set to be acquired by Meta Platforms, just nine months since its setup and five months since it moved its headquarters from China to Singapore.

Meta, which announced the acquisition on Tuesday (Dec 30), has placed great importance on AI and spent billions to secure talent, hardware and software models. The Manus acquisition is the latest in the Facebook parent company’s efforts.

The Wall Street Journal reported the value of the deal to be in excess of US$2 billion.

Launched by Chinese AI product studio Butterfly Effect Technology in March, the Manus platform was touted as the world’s first “general” AI agent.

An AI agent can, in theory, complete tasks like resume-screening, financial document analysis and stock analysis. Regular large-language models like ChatGPT or Gemini, on the other hand, can largely only give instructions on how to carry out such tasks; Manus thus lay claim to being able to also act.

Earlier this month, Manus reported an annual recurring revenue (ARR) exceeding US$100 million, and a revenue run rate, including usage-based and other revenue streams, of more than US$125 million.

The Business Times takes a closer look at this China startup.

Fast-growing agentic AI startup

Unveiled in an early-preview stage in March with a viral demonstration video, the tool quickly gained over 138,000 members on messaging platform Discord, and sparked a frenzy for codes to access it.

Early-access codes for Manus, officially released for free, were being sold for as much as US$13,700 on secondary markets, China Daily reported.

SEE ALSO

The Manus platform combines versions of established AI models like Anthropic’s Claude and Alibaba’s Qwen.

The company said then that the Manus agent performed better than OpenAI’s Deep Research, and that comparisons between it and Chinese AI model DeepSeek had shaken the industry in January.

Manus received more than US$10 million from firms like ZhenFund, Tencent and HongShan Capital; in April, it raised another US$75 million. That financing round, led by Benchmark Capital, valued the company at about US$500 million, Bloomberg News sources said.

Its access-based preview became a public release in May, and its users eventually ran into the millions, said the company.

The move to Singapore

In July, Manus began a move to Singapore by hiring more than 20 staff for its office in the city-state. It also began hiring for roles in Tokyo and San Francisco, and laid off dozens of staff in its offices in Beijing and Wuhan, reducing its headcount from about 120 staff by two-thirds.

Moving to Singapore gave Manus better access to international markets and computing resources such as AI chips. The relocation was also aimed at reducing the impact of US restrictions on Chinese AI companies, and avoiding some of the escalating US-China competition in AI.

The US restrictions, which prohibited or required notification for US investments in Chinese entities working on sensitive technologies, created significant compliance risks and due-diligence requirements for US investors.

The startup also removed all content from its Chinese social media accounts. Its tool also became unavailable in China, despite earlier statements that a Chinese version was “under development”.

Why did Meta buy Manus

Meta has spent aggressively to catch up with rivals like OpenAI, Google and Microsoft in the AI race. Its final guidance for its spending on AI for 2025 was between US$70 billion and $72 billion.

The company has also paid its researchers salaries running into the hundreds of thousands of dollars to develop a new state-of-the-art AI model that it plans to debut early next year, and investors now fear that its spending will not translate to earnings in the near-term.

Meta said on Monday that it would continue to operate and sell the Manus service, and that the startup’s agents would be integrated into its consumer and business products.

The Instagram and WhatsApp parent company already has an AI chatbot, Meta AI, as well as AI glasses.

Manus co-founder and chief executive Xiao Hong said on X that the deal will enable his company to expand the reach of its agents, which his company will now be able to build “at a scale we never could have imagined”.

Still, the deal could face hurdles. US regulators in 2024 probed similar deals. Microsoft’s absorption of Inflection AI and Amazon’s deal with Adept are examples, and Meta could face antitrust reviews.