Meta’s unwinding of Manus shows even forced deals have merits

There’s a company in the fast-moving world of AI that is for sale at the same price as the vendor paid a year or so ago. But for Facebook owner Meta, which is in talks to offload Chinese agentic AI start-up Manus, the whole transaction has worked out better than it might appear.

For sure, Meta is a forced seller, unwinding the deal at Beijing’s behest. As a buyer, Meta was paying market prices. Its $2bn acquisition price was equivalent to 20 times then-annual recurring revenue of $100mn. That was in line with the value ascribed to Anysphere, maker of vibe-coding agent Cursor, at its fundraising around the same time.

Now turned seller, Meta has a very small pool of buyers. Given the requirement for Beijing’s approval, any buyer must presumably be in China, where Manus was originally founded before decamping to Singapore. Safest of all is the same posse of mainly Chinese investors, including Tencent, from whom Meta bought Manus in the first place. They may well get a sweet deal: $2bn is just four or five times Manus’s latest annual recurring revenue.

But if the Chinese tech investors are benefiting from a geopolitical discount, Meta is not necessarily a loser. The group was quick to integrate Manus’s AI, which has a bevy of subagents carrying out tasks such as market research and writing code, into its ad management tools, although it has reportedly since separated the technology out again. In any case, during its shortlived ownership it has presumably managed to suss out how Manus works.

And with AI developing at warp speed, “acqui-rent” can make sense. Technologies that are rendered inferior by improved versions are not the sort of things worth owning over the long term.

Manus wowed onlookers when it was launched — “ChatGPT operator killer” was one billing among early testers — but is only a wrapper on top of Anthropic’s Claude model. Detractors can be found on Reddit and UK review platform Trustpilot. Meantime, a growing band of Chinese companies are producing their own increasingly well-regarded AI models.

Returning Manus to a rejigged line-up of the original holders — US venture capital firm Benchmark is unlikely to return — will not be the last word. Local VC funds who were among Manus’s original owners were presumably not counting on an exit that turned out to be nothing more than a short detour.

One option for them is an initial public offering either in Hong Kong or mainland China. That, though, looks less viable as markets are seized with AI jitters and even big operators such as OpenAI may struggle to float. There are losers from this saga, which is yet another result of the tussle between Washington and Beijing for tech supremacy. But Meta isn’t one of them.[email protected]