Meta Acquires Manus, a Chinese Team, for Billions of Dollars: A Global Breakthrough for Chinese AI Entrepreneurs

A major news story recently broke in the tech world: Meta acquired Butterfly Effect Technology, a Singaporean company founded by the Chinese team that developed the AI ​​application Manus, for billions of dollars. This deal is Meta’s third-largest acquisition to date, after WhatsApp and Scale AI. The negotiations were completed in just over ten days, a speed so fast that Liu Yuan, a partner at ZhenFund, admitted he “once suspected it was a fake offer.”

The core target of this acquisition, Manus, is an agent product that can utilize multiple tools to solve complex problems. Launched in March 2025, it garnered global attention and achieved a remarkable annual recurring revenue (ARR) exceeding $100 million by December of the same year. Butterfly Effect’s growth path has not been smooth sailing. Founder Xiao Hong started in Wuhan, successfully selling his early WeChat ecosystem plugins, Yiban and Weiban. His first AI product, Monica, although initially questioned as a “shell” product, became one of the few profitable products in the Chinese AI industry. In 2024, with the help of ZhenFund, seasoned entrepreneurs such as Ji Yichao and Zhang Tao joined the company to create Manus, its core product.

Its growth is evident from its funding history: it completed two rounds of financing in 2023, with its valuation climbing from $14 million to $50 million; from 2024 to 2025, its valuation further jumped to $85 million, nearly $500 million, attracting investment from leading Chinese and American capital firms such as Sequoia China, Tencent, and Benchmark Capital. Ultimately, Zuckerberg’s sincere terms and vision of “super intelligence empowering individuals” impressed the founding team. After the acquisition, Butterfly Effect will continue to operate independently, and Xiao Hong will become Vice President of Meta.

The significance of this acquisition goes far beyond the commercial transaction itself. For Meta, this is a key step in advancing its “super intelligence” vision; Meta had previously offered hundreds of millions of dollars in annual salaries to attract AI talent and restructure its research team. For the Chinese AI startup community, as Liu Yuan said, this is a tremendous encouragement to the new generation of young entrepreneurs. ZhenFund Managing Partner Dai Yusen offered a more insightful assessment: Manus is not just a startup, but also symbolizes the entrepreneurial spirit of a new generation in China—competing openly and fairly on the global stage, without relying on connections or seniority.

From being questioned to being acquired by a global tech giant for a hefty sum, Manus’s butterfly effect breakthrough demonstrates the hard power of Chinese AI entrepreneurs at the application layer. This acquisition is not only a commercial success, but also heralds the arrival of an era belonging to a new generation of young Chinese entrepreneurs.