Meta Buys AI Startup Manus, Adding Millions of Paying Users
The deal for more than $2 billion is one of the first in which a major U.S. tech company has bought a startup with Chinese roots
Meta Platforms has agreed to acquire AI startup Manus, a Singapore-based company with Chinese founders that conducts deep research and performs other tasks for paying users.
Meta META is closing the deal at more than $2 billion, according to people familiar with the acquisition. Manus was seeking a fresh round of fundraising with a valuation of $2 billion when Meta approached the startup, some of the people said.
Manus’s co-founder and chief executive, Xiao Hong, who often goes by the nickname “Red,” will report to Javier Olivan, chief operating officer of Meta, some of the people said.
The terms of the deal weren’t disclosed. The acquisition is among the highest-profile examples of a major U.S. tech company buying an AI product developed in Asia’s AI and startup ecosystem.
Manus gained a wide following after previewing an AI agent in March that was capable of producing detailed research reports and building custom websites, using AI models developed by companies such as Anthropic and China’s Alibaba. That demo followed the release of DeepSeek, a made-in-China AI model that rocked Silicon Valley due to its advanced capabilities, coupled with claims by its developer that it was developed with far less computing power than American rivals.
The deal is a move in a new direction for Meta, which is investing aggressively in AI to compete with Google, Microsoft and OpenAI. The deal would help the social-media giant cement its position in the product segment of AI agents, an increasingly intense battlefield of AI companies that make tools to conduct complex tasks with minimal human input. Microsoft has operated a popular AI assistant Copilot.
Meta says it plans to continue to operate and sell Manus’s service and integrate it into its suite of social media products. Meta has previously touted so-called “open source” models that are largely free to access, modify or distribute.
“We plan to scale this service to many more businesses,” Meta said in its announcement about the deal.
Meta’s existing AI offerings are widely available for free in services including Instagram and WhatsApp, and the company has also fully incorporated AI into its advertising in ways that have fattened its bottom line, according to analysts.
After Meta faced unexpected challenges earlier this year while preparing to roll out a new model, Chief Executive Mark Zuckerberg went on a recruiting blitz to build an AI dream team, offering top executives and researchers multimillion-dollar paydays.
The company acquired a 49% stake in startup Scale AI that valued Scale at $29 billion, and Scale founder Alexandr Wang joined the social media giant as its chief AI officer.
Manus has garnered millions of users since its spring launch, including some who pay subscriptions to use its models for analysis, coding and other tasks.
In April, Manus raised $75 million in a fundraising round led by venture firm Benchmark. As part of the deal, Benchmark’s general partner Chetan Puttagunta joined the company’s board. After the investment, Manus’s valuation was boosted to $500 million, people familiar with the matter said. It also counts HSG, ZhenFund and Tencent as major investors.
In December, the startup announced it had crossed $100 million in annual recurring revenue, eight months after it launched. Around the same time, Meta started negotiating with the company for the acquisition, some of the people said.
“Joining Meta allows us to build on a stronger, more sustainable foundation without changing how Manus works or how decisions are made,” Xiao said in an announcement Monday. Xiao is one of two Chinese co-founders of the company.
The parent company behind Manus, Butterfly Effect, was founded in 2022 and had offices in Beijing and Wuhan. In October 2024, the company started developing Manus. Although most of its researchers and engineers were based in China, Manus was launched outside the country as it used many American AI models that aren’t available in China.
After securing investment from Benchmark, the company officially moved its headquarters to Singapore. U.S. lawmakers have criticized Benchmark for backing an AI company with ties to China. Manus has also shelved its plan to develop a version for the Chinese market, people familiar with the matter said.
Manus has around 100 employees, mainly in Singapore.