Early Manus Backers Move to Re-Acquire AI Startup From Meta

Early investors in Manus are preparing to buy the artificial intelligence startup back from Meta for the same $2 billion that the social media giant originally paid, according to reports. The move follows an order from the Chinese government in April requiring Meta to unwind its acquisition of the China-founded, Singapore-based company. The buyback would mark one of the most unusual reversals in recent technology dealmaking, returning Manus to a group of backers that helped finance its rise before the transaction closed.

The reported buyback group includes HSG, ZhenFund and Tencent, alongside other early Manus investors. HSG and ZhenFund are considering using fresh capital to fund their participation, according to reports. Early investor Benchmark is reportedly not taking part in the re-acquisition. The structure and timing of the deal remain subject to negotiation, regulatory review and the completion of Meta's separation from Manus.

Key Facts at a Glance

• Early Manus backers are preparing to re-acquire the AI startup from Meta for $2 billion, the original purchase price.
• HSG, ZhenFund, Tencent and other early investors are participating in the buyback.
• HSG and ZhenFund are considering using fresh capital for their roles in the transaction.
• Benchmark, an early investor, is reportedly not participating.
• Manus annualised revenue run rate has grown from $100 million at the time of the acquisition to between $400 million and $500 million.
• The company is considering a structure change into a China-incorporated joint venture, which could lead to a Hong Kong listing.
• Meta has completed operational separation from Manus and halted data-sharing with the startup, according to reports.
• A key executive involved with Meta's internal AI agent work reportedly plans to leave the company.

The development underscores how quickly regulatory and geopolitical forces can reshape ownership in the global AI sector. It also highlights the growing value of AI startups that build autonomous agents and productivity tools, even as governments tighten controls over sensitive technology and data flows.

Deal Background: Meta's Acquisition and the Unwind Order

Meta agreed to acquire Manus in a deal reportedly valued at $2 billion. At the time, the transaction was seen as part of Meta's broader effort to accelerate its artificial intelligence capabilities and compete with rivals in the race to develop advanced AI assistants, agents and enterprise tools. Manus, which was founded in China and later based in Singapore, had attracted attention for its ability to perform complex, multi-step tasks with limited human oversight.

The original deal was reportedly struck in December. But in April, Chinese authorities ordered Meta to unwind the acquisition. The exact legal and regulatory basis for the order has not been fully disclosed, but it fits a pattern of increased scrutiny of cross-border technology transactions involving AI, data and advanced computing. Chinese regulators have grown more assertive about deals that could transfer intellectual property, talent or data outside the country, particularly when the technology has strategic value.

For Meta, the order created a complex operational challenge. The company had to separate Manus from its internal systems, stop sharing data with the startup and prepare for a possible divestiture. According to reports, Meta has now completed operational separation from Manus and has halted data-sharing. That separation is a critical precondition for any buyback, because it allows Manus to re-establish independent operations and for the early investors to take control without entangling Meta's systems or personnel.

Who Is Participating in the Buyback?

The buyback consortium is anchored by some of Manus's earliest financial backers. HSG, formerly Sequoia Capital China, and ZhenFund are both prominent venture capital firms with deep experience in Chinese technology. Tencent, the Chinese internet giant, is also reportedly participating. Their involvement suggests continued confidence in Manus's technology and revenue trajectory, even after the regulatory disruption caused by the Meta deal.

HSG and ZhenFund are considering using fresh capital to fund their portions of the buyback. That detail is significant because it indicates that the investors are not merely recycling existing reserves or converting prior holdings. They are willing to commit new money to bring Manus back under independent ownership. The participation of Tencent, meanwhile, could provide strategic support in areas such as cloud infrastructure, distribution and enterprise relationships.

Benchmark, another early investor, is reportedly not participating in the buyback. The reasons were not immediately clear. Benchmark has a long history of backing early-stage technology companies, but its decision to sit out this transaction may reflect portfolio strategy, risk assessment or the complexity of the cross-border regulatory situation. Its absence also means the ownership structure of a re-acquired Manus could look different from its pre-acquisition cap table.

Manus Revenue Growth Since the Acquisition

One of the most striking elements of the reported buyback is the change in Manus's financial performance. At the time of the acquisition, Manus had an annualised revenue run rate of about $100 million. According to reports, that figure has since risen to between $400 million and $500 million. The growth reflects strong demand for AI tools that can automate workflows, conduct research, manage tasks and support enterprise productivity.

Revenue growth of that magnitude in a relatively short period would make the original $2 billion price look increasingly attractive to the early backers. If Manus can sustain its momentum, the buyback could be viewed as a chance to re-acquire a company that has become significantly more valuable since the deal was signed. The revenue figures also underscore the broader commercial opportunity in agentic AI, a category focused on systems that can plan, reason and execute tasks across software environments.

The growth has not come without challenges. The unwind order, the separation from Meta and the uncertainty over ownership have likely consumed management attention and created operational distractions. Customers and partners may also have worried about continuity, data governance and long-term support. The buyback, if completed, would resolve some of that uncertainty by giving Manus a clear independent ownership structure and a path toward a potential public listing.

Potential Hong Kong Listing and Corporate Restructuring

Manus is considering changing its structure to become a joint venture incorporated in China, according to reports. That change could pave the way for a Hong Kong market listing. A China-incorporated joint venture would give the company a domestic legal identity while potentially allowing it to retain international operations through subsidiaries or contractual arrangements. It would also align Manus more closely with the regulatory expectations of Chinese authorities.

A Hong Kong listing has become an increasingly attractive option for Chinese AI companies. The market offers access to international investors, a familiar legal framework and a gateway to mainland Chinese capital. In recent months, Chinese AI startups including Zhipu and MiniMax have found success with Hong Kong listings. Their performance could encourage Manus and its backers to pursue a similar route if the buyback is completed and the company stabilises its ownership.

However, a Hong Kong listing would require extensive preparation. Manus would need to clarify its corporate structure, audit its financials, strengthen governance and demonstrate a sustainable path to profitability or at least durable revenue growth. The company would also need to address any lingering concerns about data security, cross-border operations and the role of its early investors. Still, the possibility of a listing gives the buyback a clear strategic rationale beyond simply reversing the Meta transaction.

Meta's Operational Separation and Internal AI Plans

Meta has reportedly completed operational separation from Manus and has halted data-sharing with the startup. That step is important for both sides. For Meta, it reduces regulatory risk and helps the company comply with the unwind order. For Manus, it creates a cleaner boundary that allows the startup to rebuild its independent operations, protect its intellectual property and negotiate with investors without ongoing entanglement.

Before the unwind order, Meta had reportedly been planning to use Manus-like technology in an internal initiative to use AI to replace human workers. That plan reflects a broader industry trend: large technology companies are exploring how AI agents can automate routine tasks, reduce headcount and improve efficiency. The idea of using AI to replace human workers is controversial, but it is also a powerful driver of investment in agentic AI systems.

The separation from Manus does not necessarily end Meta's interest in such technology. Meta has extensive internal AI research and development capabilities, and it may continue to build similar systems in-house. But the unwind order likely disrupted its timeline and forced it to rely more heavily on internal development or other partners. The episode illustrates how cross-border regulatory decisions can affect not only ownership but also product roadmaps and workforce planning.

Executive Departure Signals Shift

Emily Dalton Smith, a key executive involved with applying Manus-like technology to Meta's internal AI agents, reportedly said in an internal memo to staff earlier this week that she planned to leave the company. Her departure could signal a shift in Meta's internal AI priorities or reflect the broader disruption caused by the unwind order. Executive turnover in high-profile AI initiatives is often closely watched because it can indicate changes in strategy, resource allocation or leadership support.

Smith's role connected Meta's internal agent efforts with the technology and capabilities that Manus had developed. With Manus separating from Meta, the internal initiative may need to be restructured or rebranded. Her exit could also create uncertainty for teams working on AI agents, particularly if the company decides to slow down, pivot or reorganise those efforts. Meta has not publicly detailed its plans for the internal AI agent program.

For Manus, the departure is a reminder that the company's technology has attracted significant attention from major technology firms. It also highlights the competition for AI talent and the difficulty of integrating acquired AI startups into large corporate environments. As Manus moves toward independence, it will need to rebuild its own leadership and engineering momentum while navigating the aftereffects of the failed acquisition.

Why the Buyback Matters for AI Startups

The Manus buyback is notable because it involves reversing a completed acquisition at the original price. Such outcomes are rare. Most cross-border technology deals either close and remain closed, or they are blocked before completion. A post-closing unwind followed by a buyback by early investors creates a unique precedent for how governments, companies and investors handle strategic AI assets.

The transaction also shows that early investors can play a stabilising role when regulatory intervention disrupts a company's ownership. By stepping back in, HSG, ZhenFund, Tencent and others could preserve Manus's independence, protect its technology and provide a bridge to a future listing. At the same time, the buyback may raise questions about valuation, governance and the influence of Chinese investors in a company with global ambitions.

For the broader AI startup ecosystem, the outcome could affect how founders and investors structure cross-border deals. Companies may increasingly use joint ventures, dual entities or regional subsidiaries to isolate regulatory risk. Investors may demand more flexibility to unwind transactions or re-acquire assets if approvals are revoked. And startups may think more carefully about which strategic partners they bring in, especially when those partners are large platforms with their own AI agendas.

Chinese AI Listings and Regional Competition

Chinese AI startups including Zhipu and MiniMax have found success in recent months with Hong Kong listings. Their listings have provided a benchmark for valuation, investor appetite and regulatory tolerance. If Manus follows a similar path, it could become part of a new wave of China-linked AI companies seeking public market capital to fund research, hiring and expansion.

Hong Kong has long been a bridge between mainland Chinese companies and international capital. For AI firms, it offers access to investors who understand the Chinese market but also operate in a global financial centre. A successful Manus listing could strengthen that bridge and encourage other AI startups to consider Hong Kong rather than solely pursuing listings in the United States or remaining private.

At the same time, the region's AI competition is intensifying. Chinese companies are racing to develop large language models, AI agents and enterprise applications, while US firms continue to push the frontier. Manus operates in a crowded field, but its revenue growth suggests it has found product-market fit in at least some segments. The buyback and potential listing would give it more resources and visibility to compete.

What Comes Next for Manus

The next steps for Manus will depend on the completion of the buyback, the final terms of the separation from Meta and the company's ability to restructure into a China-incorporated joint venture. If those pieces fall into place, Manus could move toward a Hong Kong listing and a new phase of independent growth. If not, the company could face prolonged uncertainty, making it harder to retain talent, sign enterprise customers and raise capital.

The early backers appear to be betting that Manus's revenue momentum and technology are worth the complexity. Their willingness to fund a re-acquisition from Meta suggests they see a future in which Manus is valued well above the original $2 billion price. The company's annualised revenue run rate of $400 million to $500 million gives that bet a concrete financial foundation, even as regulatory and operational risks remain.

Meta, meanwhile, is moving on. It has completed operational separation, halted data-sharing and is dealing with the departure of an executive tied to its internal AI agent initiative. The company will likely continue investing in AI, but the Manus episode may make it more cautious about cross-border acquisitions in sensitive sectors. For Manus, its investors and the wider AI industry, the buyback is a test of whether independent ownership can deliver faster growth than integration into a global platform. The answer will shape not only Manus's future but also how the next generation of AI startups approaches the delicate balance between capital, regulation and control.

Source: Silicon UK News