Futu’s Li Hua Bounces Back From Crackdown, Amasses $9.6 Billion Fortune

Li Hua, founder of the Chinese online brokerage and wealth management platform Futu Holdings, has seen his net worth more than triple to $9.6 billion from 2024 levels, proof of a successful strategy to counter a government crackdown that threatened his core business.

The 47-year-old, who is Futu’s chairman and CEO, derives his wealth from a stake in the Nasdaq-listed company. Shares have rallied more than 200% over the past year as investors approve of the company’s international expansion and progress in attracting new customers and investors who use one of the company’s apps.

This vote of confidence comes after Futu was forced into survival mode following a government crackdown that started in 2022. Amid worries over capital outflow and data security, authorities in mainland China asked Futu and its competitor Up Fintech Holding to stop taking new onshore app users. The company’s Futubull trading app was removed from app stores in mainland China in 2023, dealing another blow to its attempts to grow. Existing users could still access the platform.

Today, Futubull is still not available to onshore investors in mainland China. But over the past three years, Li has expanded to international markets including Malaysia, Singapore and the U.S. The company has devised clever marketing campaigns that include giving free Apple shares to users in Malaysia and sponsoring the New York Mets baseball team in the U.S. Amid the equity boom in markets such as the U.S. and Hong Kong, Futu’s retail users are eager to trade stocks via its Moomoo international platform.

“They have made eye-catching progress in user acquisition, profit and sales,” Wang Hanyang, a Shanghai-based analyst at research firm 86Research, says by WeChat. “I think the company is still at an early stage of its development.”

Futu has declined to make Li available for an interview. In a written statement to Forbes, CFO Arthur Yu Chen says Futu aims to “capture a broader global client base” through measures such as partnerships and acquisitions.

In results announced last week, Futu said sales increased 69.7% year-on-year to HK$5.3 billion ($676.6 million) in the second quarter that ended in June. Net income jumped 112.7% year-on-year to HK$2.6 billion in the same period.

About 70% of the company’s new app users are from markets such as Singapore and the U.S., while the rest are based offshore in Hong Kong, estimates 86Research’s Wang. In total, Futu manages HK$973.9 billion worth of user assets, according to its second quarter results announcement.

Wang says Futu can also potentially generate more growth from newer businesses like cryptocurrency trading. It has started to offer users in markets such as Hong Kong and the U.S. services like buying and selling major digital currencies from Bitcoin to Ethereum.

Yet the company faces uncertainties. User growth might slow if the global stock market boom fades, says Wang.

While expectations are growing that the Federal Reserve will soon cut interest rates—which might be a boon to stocks as the policy move is seen as boosting the economy and supporting riskier assets in general—a sharp slowdown in China might hurt sentiment in Hong Kong.

But a recent rally in the Asian financial hub might continue as valuations of Chinese equities are still considered cheap compared to historically high levels reached a decade ago, according to a Nomura research note published on Monday. Plus, investors are expecting authorities to unleash a new round of fiscal stimulus if the Chinese economy weakens further, according to the note.

“We expect sustained net asset inflow to be supported by the strong market momentum across markets,” Deutsche Bank analyst Johnny Xie wrote in an Aug 26 research note on Futu.

Over the long run, it remains to be seen if Futu can make progress in more international markets. In Malaysia and Singapore, the company quickly gained traction due to the absence of a strong local competitor, says Wang. But in Japan, users tend to use local trading platforms instead of trying a foreign service, he says. Plus, U.S. online broker Robinhood is actively expanding in Asia, stepping up competition to Futu.

Futu’s Chen says the company remains committed to global expansion, pointing to its strength in developing new products and services such as cryptocurrency trading.

“We’re also strategically broadening our range of financial products and services,” he wrote in the statement. “Additionally, we’ve seen an increasing influx of high-net-worth individuals and their assets to our platform, a segment we aim to grow further with dedicated customer service and diversified product offerings.”