Manus resumes independent operations after Beijing forced Meta to unwind its $2B deal

Why it matters

Beijing forced a completed Meta acquisition into reverse, showing that Chinese regulators can reach AI technology and founders after they move offshore. Manus survived, but its users and ownership structure had to be rebuilt around the separation.

Manus resumed independent operations on September 1st after Chinese regulators forced Meta to unwind its acquisition of the AI agent maker, ending eight months of ownership upheaval for one of 2025's fastest-growing AI products.

Red Xiao (@Red_Xiao_), Tao Zhang (@hidecloud) and Yichao "Peak" Ji (@peakji) will continue leading Manus, according to the announcement. Manus said the founders would keep focusing on product development and general-purpose AI agents, software designed to execute multi-step work rather than only generate responses.

The September 1st announcement completes a transition Manus began explaining to users on August 11th. The separation required Manus to divide accounts and data created before and after Meta's acquisition, temporarily interrupting service for some customers and forcing affected users to back up and restore their work.

An eight-month acquisition

Meta acquired Manus on December 29th, 2025, in a transaction reported at more than $2 billion. Meta planned to use Manus's agents across its consumer and business products while continuing to sell the service through the existing Manus app and website.

The deal gave Meta a working AI agent with paying customers while its competitors were racing to move beyond chatbots. Manus could perform tasks such as research, software development and presentation creation by operating websites and other computer tools. Shortly before the acquisition, Manus said it had reached $100 million in annual recurring revenue eight months after launch, a company-supplied figure that was not independently audited.

For Xiao, the sale capped a rapid ascent that began with Butterfly Effect, which he founded in China in 2022. Butterfly Effect first built Monica, a browser-based AI assistant, before developing Manus. Ji, Manus's chief scientist, became the public face of the product after presenting it in a March 2025 launch video. Zhang brought the product and operating experience that helped turn the agent into a commercial service rather than a research demonstration.

Meta initially said Manus would sever its Chinese ownership ties and stop operating in China. Manus was based in Singapore by then, with most employees located there, but the technology had been developed by a business and engineering organization with roots in Beijing.

That history proved decisive. On April 27th, China's National Development and Reform Commission prohibited the foreign acquisition and ordered the parties to reverse the transaction. The regulator did not publish a detailed explanation for the decision.

Meta and Manus had already completed the deal. Reversing it required separating systems, employees, data and ownership after integration had begun. Bloomberg reported in June that Meta had stopped sharing data with Manus, blocked Manus personnel from internal Meta systems and prohibited Meta employees from using Manus for internal projects.

Independence required a data reset

The corporate reversal reached users directly. In an August service notice, Manus said certain account information and task data created on or after December 29th would be deleted to satisfy regulatory requirements in specific jurisdictions.

Affected users were given until August 23rd to download backups. Manus then carried out deletions and opened a restoration portal on August 25th. The process covered task histories, generated websites and presentations, subscription records and authorizations connecting Manus to third-party services. Some subscriptions were canceled and refunded.

Those measures show how quickly an acquisition billed as an infrastructure and distribution advantage became an operational liability. Manus had to reconstruct customer records around the exact date Meta took ownership, while users bore the burden of preserving and restoring work created during the acquisition period.

Tencent replaces Meta at the center of the ownership story

Manus's return to independent operations does not necessarily restore its pre-acquisition ownership structure. Caixin reported in August that former investors Tencent, ZhenFund and HSG participated in a $2 billion buyback from Meta. Caixin said Tencent acquired the stake previously held by Benchmark and became Manus's largest shareholder, citing a person close to Manus.

That reported structure makes Manus independent from Meta while placing a major Chinese technology group at the center of its capital base. Xiao, Zhang and Ji remain responsible for building the product and running Manus, but the transaction that restored their operating independence also reshaped the investor group behind them.

Manus now returns to the same strategic problem it faced before Meta arrived: funding the costly infrastructure required for autonomous agents while competing against AI platforms with larger model budgets, deeper cloud relationships and built-in distribution. The founders have their product back. They also have a clear example of how little an offshore headquarters can matter when regulators view the underlying technology as a national asset.