US Government Reviews Benchmark’s Investment in Chinese AI Startup Manus

Manus AI, a rapidly rising player in the AI agent startup scene, has recently secured $75 million at a valuation of approximately $500 million in a funding round led by Benchmark. However, reports indicate that the U.S. Treasury Department is now scrutinizing this investment to ensure compliance with 2023 regulations that restrict investments in Chinese firms.

According to unnamed sources reported by Semafor, the Treasury’s review stems from concerns about Benchmark’s ties to Manus. Benchmark’s legal team previously determined that Manus does not develop its own AI models; instead, it functions as a “wrapper” around existing models. They also argued that Manus cannot be classified as a Chinese company since it is incorporated in the Cayman Islands, a common practice among Chinese firms, like Alibaba, to facilitate foreign investment.

Despite the legal rationale backing the investment, Benchmark faces criticism for this move. Delian Asparouhov, a partner at Founders Fund, expressed his disapproval publicly on social media, commenting, "wow, actions have consequences?" Benchmark, Manus, and representatives from the Treasury have not responded to requests for comments regarding this situation.

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