AI agent startup Manus has raised more than $500 million in its first funding round since Chinese regulators forced Meta to abandon its acquisition of the company, signaling that investor appetite for AI-agent startups remains strong despite the setback.

Butterfly Effect, Manus’ parent company, said Thursday that the round was led by private equity firm Boyu Capital and venture investor IDG Capital, with follow-on investment from existing shareholders Tencent, HSG and ZhenFund.

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, which would make it the country’s most valuable AI agent maker.

The raise suggests investors are not deterred by Beijing’s unprecedented order to block Meta’s short-lived $2 billion acquisition. Meta was working to integrate Manus’ team and technology into its system when authorities blocked the deal. It also shows that appetite for AI-agent startups has held up, even as underlying foundation models improve quickly and price competition intensifies.

“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,” said Dan Wang, China director at Eurasia Group, also noting renewed confidence in the commercial potential of AI agents.

Manus could ultimately aim for a public listing, but analysts say the more imminent task would be revamping its business and ownership structure to prove profitability and align with Beijing’s regulatory requirements.

“The immediate task for Manus now is proving scale, profitability and regulatory alignment,” said Han Lin, China country director at The Asia Group.

Earlier this month, Manus said it had resumed independent operations after its split from Meta and that its founding team would continue to push forward generative AI agents for users globally.

A Cautionary Tale

Once seen as a blueprint for Chinese startups seeking global reach, Manus has become a cautionary tale for companies squeezed between regulators in Beijing and Washington.

The company launched in early 2025 in China, then moved its staff to Singapore after winning backing from U.S. venture firm Benchmark. Meta announced the acquisition in December. Chinese regulators later blocked it. The National Development and Reform Commission said it had decided to “prohibit foreign investment in the Manus project.” By then, Meta had begun integrating Manus’ team and technology into its own.

Since the split, the AI startup has unveiled Manus 2.0, built on a new in-house execution system called Cascade. It also launched Cue, a standalone personal-agent app in which each agent has its own email address, phone number and mobile wallet.

Meta has pressed ahead with its own personal AI agent, launching its Muse agent in early September, modeled on the open-source AI agent OpenClaw.

The “close integration” with Manus “does not disappear when the transaction is reversed,” said Matthias Hendrichs, a Singapore-based adviser to global AI firms.

“You can separate companies, but you cannot make engineers forget what they learned.”