Meta makes $2 billion bet on agentic AI with Manus acquisition

Its automated research and web tools drew millions of users within months

by · TechSpot

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What just happened? Meta Platforms has agreed to buy Singapore-based artificial intelligence startup Manus in a deal valued at more than $2 billion, according to people familiar with the matter. The acquisition marks one of the largest purchases by a US tech giant of an AI product from Asia.

Manus gained international attention earlier this year when it unveiled an AI agent capable of generating detailed research reports and building customized websites. The system drew on models from both US and Chinese developers, including Anthropic and Alibaba, and was designed to handle multifaceted requests from paying users. The company's rapid ascent and hybrid technology base made it an attractive target for Meta as it sought to strengthen its AI tool portfolio.

The deal would bring Manus's co-founder and CEO, Xiao Hong – known as Red – into Meta's executive structure, where she will report to Chief Operating Officer Javier Olivan, people familiar with the arrangement told The Wall Street Journal. In announcing the deal, Meta said it plans to "scale this service to many more businesses" while keeping the Manus platform operational and integrating it with Meta's broader social media ecosystem.

For Meta, the acquisition signals a more aggressive play in the expanding market for AI agents. Microsoft's Copilot and similar assistants from OpenAI and Google have established early leads in the space, putting pressure on Meta to close the gap.

Manus launched in March 2025 and drew millions of users within months, offering subscription plans for access to its research, coding, and analysis tools. In December, the company disclosed that its annual recurring revenue had surpassed $100 million – an extraordinary milestone just eight months after launch. Around the same time, Meta began talks about an acquisition, according to people familiar with the timeline.

Earlier funding rounds had already set the company apart in Asia's competitive AI market. Manus raised $75 million in April in a round led by Benchmark, whose general partner, Chetan Puttagunta, later joined the company's board. That investment valued the startup at about $500 million and brought in additional backers, including HSG, ZhenFund, and Tencent.

The parent company, Butterfly Effect, was founded in 2022, with offices in Beijing and Wuhan, and relocated its headquarters to Singapore after the Benchmark investment. Most of Manus's research and engineering talent remained in China, though the firm positioned itself globally to access American-developed AI models unavailable in the Chinese market.

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"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 a statement announcing the deal.

Meta's acquisition comes as the company channels billions into AI research and infrastructure to rival Microsoft, Google, and OpenAI. Chief Executive Mark Zuckerberg has spent much of the year recruiting top AI scientists and executives with multimillion-dollar contracts following delays in rolling out Meta's next-generation AI model.

The company has also diversified its AI investments, taking a 49% stake in Scale AI at a $29 billion valuation, a move that brought Scale founder Alexandr Wang into Meta as its chief AI officer.

Meta's AI systems already underpin much of its consumer-facing platforms, from Instagram recommendations to WhatsApp chat assistants. The company has also integrated machine learning deeply into its advertising business, bolstering profits even as it rolls out largely free, open-source AI models.

Image credit: South China Morning Post