Even as the US eases restrictions on advanced chip exports to China, artificial intelligence companies may find it difficult to ignore the persistent uncertainty over when regulations might shift again. Among them is Manus.
Earlier this month, Manus shut down most of its China-based operations, laying off dozens of team members before relocating its global headquarters to Singapore, according to The Paper. Butterfly Effect, the company behind Manus, remains based in China, per Lianhe Zaobao. It’s also hiring for offices in San Mateo, California and Tokyo.
Best known for building an autonomous AI agent that attracted international attention, Manus now operates out of Singapore, a city-state that has, in recent years, styled itself as a neutral ground both geopolitically and technologically.
The move isn’t just about talent or taxes. Manus’ leadership appears to have made a judgment call: for a startup with global ambitions, especially one operating in a sector as politically charged as AI, the risks of staying anchored in China were starting to outweigh the advantages.
Access to high-end chips was a major factor. In April, the US government expanded its export controls, restricting China’s access to top-tier processors including Nvidia’s A100, H100, and Blackwell series, as well as AMD’s MI300 and MI400 lines. The restrictions were intended to slow China’s progress in developing advanced AI by limiting access to key computational hardware.
There has been some softening. This month, US trade officials reportedly granted Nvidia permission to resume limited exports to Chinese firms, specifically of its H20 chips, a technically downgraded alternative to its restricted models. AMD is also said to be preparing shipments of its midtier MI308 processors following the policy shift.
Still, for Manus and other companies, the takeaway is clear: policy reversals can occur with little warning. Even with workarounds, access to state-of-the-art hardware remains unstable for firms based in China. For any startup competing globally, that kind of unpredictability is a liability.
Singapore offers a more stable environment. It provides easier access to chip supply channels, has friendlier trade relations with the West, and maintains a regulatory system that aligns more closely with global investor expectations. Just as importantly, relocating reduces the perception risk of being viewed as a “Chinese AI company,” a label that can complicate partnerships in markets like the US and Europe.
That said, scrutiny remains. Early this year, US authorities investigated whether Chinese firms such as DeepSeek had acquired advanced Nvidia chips via Singapore as a means of circumventing export restrictions.
Manus has not publicly elaborated on its move, but multiple reports suggest the company’s primary motivation was to reduce exposure to tightening regulations in China and insulate itself from broader geopolitical risk.
Relocation also brings Manus into closer alignment with its investors. Backed by Benchmark, a US-based venture capital firm, the company benefits from positioning itself in a jurisdiction that avoids the complications often associated with Chinese affiliations. For global VCs, especially those navigating US limited partner concerns or foreign ownership rules, a Chinese headquarters can raise logistical and reputational challenges. Singapore, by contrast, offers a more neutral footing. By redomiciling there, Manus avoids these pitfalls and could position itself as a more attractive prospect for follow-on funding.
Manus may be the most visible recent example, but it isn’t the only one. TikTok, for instance, established its Asia headquarters in Singapore, partly in response to regulatory pressure. Under heightened scrutiny in Washington over its Chinese ownership, the company has invested in campaigns to bolster its credibility: hiring US-based executives, pledging to segregate data, and even considering spinning off its American operations to avoid a national ban.
TikTok’s ongoing challenges offer a cautionary tale. For younger China-born startups, the calculus is simpler: it’s easier to relocate early than to unwind operational structures and rebrand under duress. TikTok and Douyin may now be technically separate entities, but to observers, they may seem closely linked, distinguished more by language and market than by substance.
It’s too soon to know how much Manus’ move will shield it from the geopolitical friction it aims to sidestep. What is clear, however, is that other China-born startups may consider similar moves. Not necessarily in name, but in structure, by establishing overseas headquarters or split operations to keep strategic options open. Not every company is as focused on China’s domestic market as Baidu, and increasingly, that’s understandable.