A company at the center of a $2 billion acquisition derailed by the Chinese government has raised another $500 million in just six months.
Butterfly Effect, the parent company of AI agent startup Manus, announced on Oct. 8 (local time) that it had closed a funding round of more than $500 million (about 692.5 billion won).
This is the company’s first fundraising effort since its split from Meta. The round was co-led by Bowei Capital and IDG Capital, with existing investors Tencent, Sequoia China and ZhenFund also participating. The company did not disclose its valuation.
Manus develops a general-purpose AI agent designed to handle research and automated tasks with minimal human intervention.
It was founded in China in 2022 by CEO Xiao Hong and chief scientist Ji Yichao, among others, and moved its headquarters to Singapore in the middle of last year. The company gained recognition after drawing attention with an agent it unveiled in March last year.
Meta acquired Manus for more than $2 billion last December, during a period when it was aggressively buying AI talent and technology. The deal lasted less than four months.
On April 27, China’s National Development and Reform Commission said it had “decided to prohibit foreign investment in the Manus project” and ordered the deal to be unwound. It cited only violations of laws and regulations as the reason.
The decision came as scrutiny of U.S. investment in Chinese startups developing advanced AI was intensifying. Meta said the deal had “fully complied with applicable laws” and that it expected an appropriate resolution, but eventually walked away.
Manus said in August that it would resume operations as an independent company. As part of its separation from Meta, it also decided to delete some user data—reversing the transfer of data that had occurred during the integration process.
The Information reported in June that Manus had reached annualized revenue of about $500 million, up from $100 million when Meta acquired it. The same report said Manus was considering a joint-venture structure that would include an entity in China.
Tencent’s influence has also grown. In July, it was reported that Tencent was expected to become Manus’s largest shareholder during discussions about its separation from Meta, and it also participated in the new funding round.