Manus Maritime Adventure - A Brief Trend of Technology Enterprises Going Global from the Perspective of a Compliance Lawyer

Preface

A $2 billion acquisition deal, a Chinese AI star company that had been praised by CCTV, a lightning-fast headquarters relocation, and a review notice from the Chinese Ministry of Commerce - this was the most talked-about Manus acquisition by Meta in the AI market and the global tech circle in 2025-2026. Too many enterprises have set sail with technological dreams and business ambitions, but they do not fully understand the rules of geopolitical and international regulatory waters. The compliance review of Manus is still pending, but due to its unique development trajectory and the current review predicament it faces, it is likely to become a typical case of tech companies going global in the future. It clearly reveals a core proposition: In today's world where technology has become a key focus of competition, the internationalization path of enterprises is no longer simply market expansion or capital operation; it is a multi-dimensional compliance journey involving technology exports, cross-border data, company structure, investment review, cross-border mergers and acquisitions, etc. This article will review Manus' journey, analyze the legal logic behind the review, and attempt to provide a guide for all Chinese tech companies that are currently or plan to go global.

01. From the CEO of a start-up tech company to a Meta vice president, a steep rocket curve

Manus' story is a typical domestic hard-core technology entrepreneurship story. Its development pace is fast, capital entry is rapid, and strategic transformation is complete.

1. Founding period

In 2022, founder Xiao Hong founded Beijing Butterfly Effect Technology Co., Ltd. and entered the market with the AI browser plugin Monica. This tool was initially questioned, but with an excellent product experience, it achieved profitability and accumulated valuable user base and engineering experience. Judging from the surface resume and entrepreneurial trajectory, Xiao Hong is a domestic indigenous scientific and technological entrepreneur. 2. Transformation

In 2024, with the addition of core members such as Ji Yichao and Zhang Tao, the team decided to move from "tool" to "intelligent agent", developing a general AI-Agent - Manus. In March 2025, Manus emerged suddenly, defeating similar products from OpenAI in authoritative tests, and at that time, the invitation codes were in short supply. From the publicly available market information, Ji Yichao is already an important participant in many Western leading institutions at a young age, while Zhang Tao, as the product leader, has relatively less information. From the reports on the release and promotion of the Manus product on the market, product promotion sometimes occupies a lot of resources. Another market person analyzed that he should have been recommended by investors to be responsible for communicating and coordinating the relationships between domestic scientific and technological entrepreneurs and Western industry insiders.

3. Capital investment

Before being acquired by Meta, Manus had undergone 4 rounds of financing. The seed round in February 2023 and the angel round in August 2023 were invested by ZhenFund. The post-investment valuation rose from 14 million US dollars to 50 million US dollars. In November 2024, the A-round investors included Red Star China, Tencent, ZhenFund, Wang Huiwen, and Old Friendship Capital, with a post-investment valuation of 85 million US dollars. In April 2025, the B-round financing was led by the top US venture capital firm Benchmark Capital, and the company's valuation soared to 500 million US dollars. Behind multiple rounds of financing is Manus' dual listing structure.

4. Key transformation

In the summer of 2025, about 40 members of Manus' core team moved collectively to Singapore, and the company's operational entity changed to Butterfly Effect Pte., Ltd. in Singapore. Domestic business was contracted, employees were laid off, and all自媒体 accounts' content was reset. This move sparked widespread discussion. In public reports， the company stated that it aimed to avoid potential geopolitical risks.

5. Peak and the Storm Center

In December 2025， Manus announced impressive commercial results (since the product was released in March 2025， the annual revenue generated through user subscriptions exceeded 125 million US dollars). Immediately， Meta extended an olive branch. The two sides reached an acquisition agreement in 10 days， reportedly with a transaction amount of 2 billion US dollars. ZhenFund partner and angel investor Liu Yuan said that this acquisition negotiation was "so fast that one wondered if it was a fake offer". Meta stated in the statement that it would continue to operate and sell Manus services and integrate them into the company's products. The company would acquire Manus' technology and leadership team， and founder Xiao Hong would become a Meta vice president， but the specific position of the new team within the organization was not disclosed. On January 8， 2026， just as the deal was about to be finalized， the Ministry of Commerce of our country announced that it would legally initiate an assessment investigation into this acquisition case.

02. It's not "Should we sell it"， but "How to sell it"

According to a report by Xinhua News Agency on January 8, 2026, the spokesperson of the Ministry of Commerce, He Yadong, responded to a question regarding the review of Meta's acquisition of the artificial intelligence platform Manus. He said, "The Chinese government has always supported enterprises in conducting mutually beneficial and win-win cross-border operations and international technological cooperation in accordance with the law. It should be noted that enterprises engaging in foreign investment, technology exports, data export, and cross-border mergers and acquisitions must comply with Chinese laws and regulations and go through legal procedures. The Ministry of Commerce will work with relevant departments to conduct an assessment and investigation on the consistency of this acquisition with relevant laws and regulations on export control, technology import and export, and foreign investment."

These three sentences are concise and logically clear. The first sentence states that enterprises should conduct cross-border operations and international technological cooperation in a mutually beneficial manner in accordance with the law, and the government has always provided macro-level support. The second sentence directly addresses the key point: enterprises engaging in foreign investment, technology exports, data export, and cross-border mergers and acquisitions must comply with domestic laws and regulations and go through legal procedures. The third sentence outlines the subsequent arrangements: The Ministry of Commerce will work with relevant departments to conduct an assessment and investigation on the consistency of this acquisition with relevant laws and regulations on export control, technology import and export, and foreign investment. After this, the assessment and investigation may proceed in depth.

The second sentence in the above three sentences requires careful study. Because this sentence not only represents the current and future official attitude and position, but also precisely points out the four major pitfalls that technology-based enterprises are prone to encounter when going global due to the rapid development of science and technology in recent years.

1. Compliance with technology export regulations

Manus, as an AI application product, its core algorithms, model training technologies, etc., may be included in the "Catalog of China's Prohibited and Restricted Export Technologies" for control. Whether the advanced capabilities demonstrated in the GAIA benchmark test involve sensitive technologies. From the R&D center of the Beijing company to the Singapore headquarters, and ultimately flowing into Meta, does this process require and has it legally applied for and obtained the "Technology Export License"? This may become the top priority of this compliance review. And this point is often overlooked by enterprises, who believe that moving the core R&D team out can bypass technology export control.

2. Data export security

What is the iterative relationship between Manus and the previous product Monica? In the operation, it processed a large amount of data (cumulatively 147 trillion Tokens). Does this data contain domestic user information, training data, etc.? The company's headquarters moved to Singapore, and its business was taken over by Meta, meaning the data has actually been exported. According to the "Cybersecurity Law", "Data Security Law", and "Personal Information Protection Law", this move must undergo a data export security assessment. Has Manus fulfilled this legal procedure?

3. Overseas company structure and investment

Manus's four rounds of financing, the seed round, the angel round, and the A round, as the investors were mostly Chinese funds for the time being, could be not discussed. The B round introduced top Wall Street venture capital, and the company's operation was relocated to Singapore in the summer of 2025. What changes have occurred in the company's domestic and overseas structures? The personal registration of the ultimate beneficiaries under Document No. 37 should be observed with caution, and whether the company's overseas investment and establishment of companies have obtained the corresponding ODI (Overseas Direct Investment) approval should also be observed with caution. According to industry information, Manus completed the angel round financing before 2023 and had already completed the Roodhoo structure setup, specifically: 1. The Cayman company serves as the financing/上市 entity； 2. The Cayman company has a Hong Kong subsidiary； 3. The Hong Kong company then establishes a domestic WFOE (Foreign-Owned Company) Beijing Red Butterfly Technology Co.， Ltd. (established in July 2023)； 4. The domestic WFOE controls the domestic business operation entity Beijing Butterfly Effect Technology Co.， Ltd. (established in May 2022) through an agreement arrangement. Regarding the Singaporean company, the establishment time and purpose also require careful examination.

4. Cross-border M&A Report

On one hand, the acquisition of Manus by Meta is an instance of indirect overseas listing (or acquisition) by a domestic company. According to the regulations, the controlling shareholder or the actual controller of Manus should complete the filing procedures with the domestic Securities Regulatory Commission. Whether this step has been omitted is questionable. On the other hand, even if Manus is a company that has "moved out", if its assets, income, key management personnel, etc., still mainly originate from the domestic market, according to the "Foreign Investor M&A Domestic Enterprise Security Review System" and other regulations, the Meta acquisition of Manus transaction itself may also require an operator concentration declaration or a security review to the Ministry of Commerce. Whether this step has been omitted is also questionable.

Combining the above four points, it vividly interprets the regulatory principle of "substance over form", and this principle has been the bottom line and method that the relevant regulatory authorities in China have adhered to in the process of performing their regulatory duties for a long time. With the trend of globalization going in the opposite direction and the changes in geopolitics, the scale of this principle in regulatory practice has become increasingly strict. Regulatory agencies will not only consider whether the company's registration location is in Cayman or Singapore, but will also conduct a thorough examination: Where does the technology come from? Where is the team? Where are the data generated? Where is the operational essence? As long as the connection with the domestic market is sufficiently "substantial", the relevant domestic legal obligations cannot be automatically waived through "physical relocation".

03. Three possibilities, and the four "iron rules" for enterprises

Current consistency assessment investigation is still ongoing. From the perspective of practice, the following three scenarios are likely to occur:

Scenario One

The review is passed, and the transaction is approved. The premise is that Manus and the transaction party can prove the entire process of their migration and sale, have fully completed all compliance procedures under domestic laws, and the technology involved is not under strict control. The probability of this is not high.

Scenario Two

Supplementary procedures, transaction delay. The review discovers procedural flaws (such as omission of filing, lack of assessment), but the substantive issues are relatively minor. The transaction party needs to complete the procedures, pay the possible fines, and the transaction schedule will be significantly delayed. I believe this is one of the more likely results, with a certain probability.

Scenario Three

It is determined to be in violation, and the transaction is blocked. If it is found that there are substantive illegal acts such as unauthorized export of core technologies or illegal cross-border transfer of important data, the transaction may be halted, and the relevant parties will face administrative penalties and even criminal liability. This transaction will be temporarily halted or placed on hold for a long time, waiting for a longer period of discussion. If this situation occurs, it will have a profound impact on AI going global, and even the going global of high-tech enterprises.

Regardless of the result, Manus, which is in the eye of the storm, is already sufficient to ring the alarm bell for all technology entrepreneurs. As a compliance lawyer, I offer the following four "iron rules" for going global:

Suggestion One

Compliance first, not after the fact. When initiating any planning involving adjustments to the overseas structure and capital operations, the first step should be to introduce professionals for a full-chain compliance diagnosis. The compliance costs of technology export, data export, and capital investment filing should be included as core business costs in the model.

Suggestion Two

Architectural design, penetrate to examine the essence. Do not blindly believe in the shielding effect of "offshore architecture". It is necessary to combine the restrictions on foreign investment in China's negative list for foreign investment and be cautious in choosing the red-chip architecture. When designing the red-chip architecture, it is necessary to fully consider the domestic laws' criteria for "substantially domestic enterprises" to reserve compliance interfaces and response plans for future financing and mergers and acquisitions.

Suggestion Three

Data assets, clarify boundaries and paths. Data is the "oil" of the new era and also the "high-voltage line" of regulation. Enterprises need to establish a clear data asset map, distinguish between domestic storage and outbound data, and carry out cross-border data business strictly in accordance with the paths (security assessment, standard contracts, certification) stipulated by domestic laws. This aspect will become a key area that technology companies focus on and invest resources in, and it will also be the core of business security in the AI industry.

Suggestion 4

Preparedness management, responding to geopolitical risks. Incorporate geopolitical risks into the company's core strategic risk assessment system. Develop alternative plans (B plans) for possible different scenarios (such as technical inspections, acquisition reviews), to avoid being in a passive and hasty decision-making situation when a crisis occurs. Previously, people paid more attention to the long-arm jurisdiction and security reviews of the West. In fact, as a system arrangement and regulatory tool, any country and government can use this weapon. As China's national strength and technological strength continue to strengthen, we have simply done the same thing.

04. Conclusion

Manus' predicament deeply reflects the "identity dilemma" of current domestic technology companies, especially AI companies, in the context of international strategic competition. On the overseas front, through tools such as the "Outward Investment Security Plan", some enterprises are being systematically and strictly reviewed. For Manus, such actions are, to some extent, a survival instinct in this situation. On the domestic front, the bottom line of safeguarding national security and technological sovereignty cannot be shaken. The precedent of Didi has made the regulatory authorities deeply realize that the uncontrolled outflow of core data and technology is of far-reaching harm. Therefore, regulation will inevitably tighten, and any attempt to "escape" and bypass regulation for substantive technology transfer will be highly vigilant.

In such a broad context, the overseas expansion of domestic technology companies requires an extremely precise method. It requires entrepreneurs not only to be a product genius and business expert, but also to be a "strategist" who is deeply familiar with international rules, domestic regulations, and geopolitics. Pure "technological nationalism" or "globalist fantasy" are not advisable. The correct path is: on the premise of resolutely guarding the domestic legal red line and the national security bottom line, through the most transparent and compliant operations, prove the universal value and commercial potential of technology in the global market, and thereby win space and respect.