Meta acquires Chinese AI agency startup Manus, why is this a good deal?

Meta is known for its hefty investments in the AI race among tech giants. Today, it announced the acquisition of Chinese AI startup Manus, reportedly valued at over one billion dollars, drawing significant industry attention. Menlo Ventures partner Deedy commented, “Compared to AI giants like Perplexity or ElevenLabs, which are valued in the tens or hundreds of billions, this is the most affordable and suitable choice.”

Meta’s acquisition of AI startup Manus: How will it be integrated and what to expect

The announcement states that Meta has agreed to acquire Chinese AI startup Manus, adding another layer to its extensive AI investment and talent acquisition efforts.

It is understood that Manus is an AI company based in Singapore under Beijing Butterfly Effect Technology, which earlier this year completed a funding round led by US venture capital firm Benchmark, with a valuation of $500 million.

The company launched its first enterprise subscription AI agent product this year, capable of automatically performing tasks such as resume screening, itinerary planning, and data analysis without human guidance, aligning closely with enterprise needs for AI integration.

For Meta, eager to develop a viable business model, Manus’s annual revenue has already reached $125 million, providing immediate income and addressing Meta’s real weaknesses in AI applications.

(Chinese general AI agent Manus testing results are in! Early testers say the financial application scenarios perform best, and some media outlets are starting to hype it up)

AI commercialization: From chatbots to “enterprise automation employees”

The first phase of generative AI has been dominated by chat interfaces. The second phase’s competition is shifting toward AI agents—moving from providing answers to autonomously executing tasks and making independent decisions to create value.

Several SaaS (Software as a Service) companies, including Salesforce and ServiceNow, regard agents as key to AI commercialization, and Manus is no exception.

Meta plans to integrate Manus’s technology into its product lines such as Facebook, Instagram, WhatsApp, and wearable devices, to bring more convenience to its 3 billion users.

Meta lacks truly practical AI products, and VC investors point out that “buying Manus is very cost-effective”

Even though Meta has recruited many researchers from major companies in a bid to catch up in the AI race—especially in consumer and enterprise applications—Meta AI has been criticized for lacking truly practical and widespread products.

(Meta offers millions in annual salaries to attract AI talent: Apple, OpenAI, and Anthropic researchers switch jobs)

Now that the deal is done, Menlo Ventures partner Deedy said, “Given that Meta AI has almost no products, this is the most affordable and fitting choice.”

He listed eight AI applications with annual revenues over $100 million, including Perplexity, ElevenLabs, Replit, Suno, etc., valued at between $2 billion and $20 billion; in comparison, Manus’s estimated valuation of around $500 million is quite pragmatic and cost-effective.

The final stretch: Can Meta’s AI catch up with Manus’s help?

Although investors question Meta’s ability to monetize AI, CEO Mark Zuckerberg remains committed, announcing an investment of $600 billion over three years into AI infrastructure. The acquisition of Manus could be a crucial turning point for Meta’s shift from burning money to product deployment. Manus co-founder Xiao Hong further stated:

“The era where AI can only converse is just beginning; now, AI can act and create. We can now build all this at a scale previously unimaginable.”

For Meta, this acquisition is not just a product enhancement but a significant step in moving its AI strategy from experimentation to implementation and marketization, determining whether Meta can catch up with Google and Microsoft.

This article, “Meta’s acquisition of Chinese AI startup Manus: Why this is a good deal,” originally appeared on Chain News ABMedia.