Manus, a Singapore-based AI business that gained notoriety in Silicon Valley this spring after releasing a demo video that went viral right away, is being acquired by Meta Platforms. The video demonstrated an AI agent that could plan trips, evaluate stock portfolios, and screen job applicants. At the time, Manus asserted that it performed better than Deep Research from OpenAI.

Only a few weeks after launch, in April, the early-stage company Benchmark led a $75 million fundraising round that gave Manus a $500 million post-money valuation. Chetan Puttagunta, a general partner, joined the board. Tencent, ZhenFund, and HSG (previously known as Sequoia China) had already contributed $10 million to Manus at that time, according to Chinese media sites.

Manus recently revealed that it has since signed up millions of users and surpassed $100 million in annual recurring revenue, despite Bloomberg's concerns when the company began charging $39 or $199 a month for access to its AI models (the outlet noted the pricing seemed "somewhat aggressive . . . for a membership service still in a testing phase").

According to the WSJ, Meta began negotiating with Manus at that point and is now paying $2 billion, which is the same amount Manus was looking for in its next funding round.

Manus is something new for Zuckerberg, who has based Meta's future on AI: an AI product that is genuinely profitable (investors have becoming more agitated by Meta's $60 billion infrastructure spending binge).

While integrating its agents into Facebook, Instagram, and WhatsApp—where users may already access Meta's chatbot, Meta AI—Meta claims to maintain Manus's autonomy.

One issue, though, is that the Chinese founders of Manus, which debuted eight months ago, created the parent business Butterfly Effect in Beijing in 2022 before moving to Singapore in the middle of this year. It's unclear if this raises concerns in Washington, but Senator John Cornyn has already criticized Benchmark for investing in the business. In May, he questioned X about whether it was "a good idea for American investors to subsidize our biggest adversary in AI, only to have the CCP use that technology to challenge us economically and militarily? Not me.

Although he is by no means alone, Cornyn, a Republican from Texas and a senior member of the Senate Intelligence Committee, has long been one of Congress's most outspoken hawks on China and technology competition. One of the truly bipartisan concerns in Congress today is being strong on China.

It should come as no surprise that Meta has already informed Nikkei Asia that Manus will no longer operate in China and will have no connections to Chinese investors following the transaction. A representative for Meta informed the source that "Manus AI will discontinue its services and operations in China, and there will be no continuing Chinese ownership interests in Manus AI following the transaction."