The financial industry is all about paid knowledge services.

Author: Shen Hui , Yuanchuan Investment Review

Hong Hao's Knowledge Planet has officially announced a price increase, now priced at 1499 yuan per year, equivalent to a bottle of Moutai.

Before the price increase, the annual fee was 899 yuan. Based on 14,000 people recharging, Hong Hao's GMV on Knowledge Planet reached 12.586 million yuan in just two months.

Coincidentally, Hong Hao's friend Li Bei also started a paid knowledge product business. Her 200-slot course, priced at 12,888 yuan, sold out in two days. In other words, Li Bei earned 2.57 million yuan from course sales in just two days.

It's widely acknowledged that media is a notoriously bad business. This conclusion is easily drawn from the consistently poor performance of the media sector among the 31 Shenwan Level 1 industries. However, in this sunset industry, private domain traffic and course sales stand out as exceptions, attracting countless financial professionals to compete fiercely.

Jin Yi, former chief fixed income analyst at Guohai Securities, gained 1.6 million followers on his Douyin account "Bainian Talks Politics and Economics" in three months. Membership for 1-on-1 consulting services from Chief Jin costs 4,283 yuan per month. Tan Jun is about to launch the "Industry Decision Makers' Insider Circle," limited to 30 seats and priced at 159,880 yuan. The seemingly more high-end "Bull, Bear, and Beast Club" offers paid members not only access to Fu Peng's financial literacy classes but also the opportunity to ski with him at Changbai Mountain.

As fellow financial consumers, Americans have a stronger willingness to pay. Short seller Michael Burry simply shut down his hedge fund and launched a $379 annual newsletter on Substack, attracting 187,000 subscribers in just two months. Shorting Nvidia doesn't make that kind of money as easily.

Suddenly, financial giants have all jumped in, competing not on who has the most investment ideas, but on who has the most subscribers. Is it that investing money is too hard to earn, or is the business of recruiting people too easy?

Three types of levers

Silicon Valley investor Naval has mentioned that to achieve financial freedom, three types of leverage are needed:

• The first type is labor leverage, which is when the boss makes others work for you;
• The second type is capital leverage, like Buffett using capital leverage to expand his influence and make money from money;
• The third type is what he considers the most important lever—"products with zero marginal cost of replication," which mainly includes code and media.

According to Navarre, the wealth of the new generation of millionaires is created through code and media.

Joe Rogan earns $50 million to $100 million annually through podcasts[1]. He leverages this new type of leverage to amplify his work by hundreds or thousands of times simply by increasing paid memberships and online course sales. Its advantage is that the cost of replication is almost zero, and anyone with a computer and internet access can easily earn passive income.

Hong Hao and Li Bei happen to possess all three of these leverages.

Li Bei founded Banxia in 2017, and by 2022, its scale had exceeded 10 billion yuan. She had already achieved financial freedom by leveraging labor and capital. As she herself said, she does not lack the tens of millions of yuan she earns annually from paid knowledge services. However, it cannot be denied that these tens of millions of yuan are far more certain to come in the short term than waiting for a turnaround in the Chinese real estate market.

Compared to Li Bei's colorful leisure life of baking, gardening, and playing tennis, Hong Hao's recent experiences have been more turbulent.

Hong Hao was previously the chief global strategist at CICC and also worked at Citigroup and Morgan Stanley. After leaving BOCOM International in 2022, he moved between the buy-side and sell-side, joining Siri Group and Huafu International, and is now the managing partner and chief investment officer of Lianhua Capital.

However, Hong Hao's performance has always been a mystery.

In August 2023, he launched the Lotus-AAA fund with Siri Capital and Lianhua Capital. Aside from a single-month surge of 8.98% in net asset value in September 2024, its performance had been lukewarm. Perhaps due to the fund's short operating history, the performance report included backtesting of historical trends up to September 2002. At least the charts show that Hong Hao appears to have a cumulative investment return of 718.77% over 20 years.

You can question Hong Hao's actual achievements, but you can't question his charting skills.

Hong Hao and Li Bei are skilled at creating IP and generating traffic. Their proficient use of this third leverage makes them more profitable than their peers when it comes to knowledge-based paid content.

In terms of sector selection, the macro-level sector that Hong Hao and Li Bei are in naturally reaches a wider audience. Not everyone cares what Nvidia's open-source VLA model is called, but everyone cares whether gold will continue to rise in the future, and whether the stock market will have a prosperous year in the Year of the Horse and the Year of the Sheep.

In terms of expression, people prefer to listen with shining eyes to Hong Hao's prediction of the fifth wave of the bull market and Li Bei's analysis of escaping the micro-trading frenzy, rather than being drowsy by the ambiguous views of economic gurus at roundtable forums. Even if they are evasive, they will unexpectedly receive the artistic expression of "MaiMaiMai". Anyway, if you win, you buy, buy, buy; if you lose, you sell, sell, sell.

In terms of writing style development, Hong Hao is good at mixing classical Chinese and obscure characters into macro analysis, and mysteriously quoting extensively, giving people a reading experience that is both incomprehensible and shocking. Hong Hao once explained that the best articles seem to be a bunch of nonsense, but have some unexpected consequences[2]. Li Bei is able to cleverly combine her own emotional journey into macro analysis, and occasionally post blind dates, providing some topics with low participation threshold.

Because people love macro-level literature that incorporates "fortune telling" and "gossip," Hong Hao and Li Bei have captured a huge amount of traffic in the financial sector, creating a broader entry point for the transformation to paid knowledge products.

It's all business.

Fund managers are typically cautious about using the third type of leverage.

Because if fund managers start writing articles or selling courses, they're seen as neglecting their core business and diverting time that should be devoted to investment research. Furthermore, transitioning to media wouldn't garner more professional recognition, much like the criticism often leveled against financial bloggers—if they have strong enough investment skills, why would they need to spend time teaching others how to make money?

Whether it's Hong Hao creating Planet or Li Bei selling courses, their purpose in getting involved in paid knowledge services is not simply to transform into self-media.

Compared to Li Bei, Hong Hao transitioned to investment later and couldn't produce a three-year consecutive net asset value curve. Therefore, he needs to constantly market the accuracy of his predictions on social media to endorse his investment capabilities.

On November 28th last year, Business Weekly invited Hong Hao, Li Bei, and Fu Peng to a roundtable discussion. When the three discussed gold, Fu Peng's views were ambiguous, Li Bei sold off all her holdings and was bearish, while only Hong Hao revealed his detailed selling point—selling all his gold when the price reached $4,500 per ounce.

The result drew skepticism, as the price of the Comex gold futures main contract at that time never reached $4,500 per ounce. While non-main contracts did briefly reach that level, it would have been virtually impossible for a large institutional investor like Hong Hao to exit at the absolute peak in such a low-liquidity contract.

Hong Hao did not publicly disclose detailed gold trading closing statements, but instead promoted his "miracle prediction of silver witnessed by tens of thousands of people" on his social media platform. He publicly predicted:

Silver's upward trend isn't over yet; the deeper the cup, the higher the target. If 4500 is a fair price for gold, then for others, we need to use our imagination. New highs are for buying; those who are afraid of heights are destined for misery.

As described in "The Crowd," whoever masters the art of influencing the imagination of the masses masters the art of ruling them.

Hong Hao believes that silver has broken out of its 60-year-long giant "cup and handle" shape.

Ultimately, Lianhua Capital is still relatively unknown. Posting positive reviews from fans about their online community creates expectations of price increases, allowing them to sell more "Planet Moutai" (a metaphor for high-quality, high-quality products), which can incubate more future private equity clients. Compared to management fees and performance-based compensation, this approach offers higher short-term economic benefits.

After all, it's easy to express a "bullish view" on silver, like two sides of a coin; if it goes up, you can brag about it. But "heavily betting on silver" involves a multi-dimensional game involving the market, human nature, rules, and scale.

Compared to Hong Hao, Li Bei faces a different situation. After reaching the 10 billion yuan mark, Banxia's performance growth stagnates, and it fell out of the 10 billion yuan private equity club at the beginning of this year. In an environment where Bridgewater China remains dominant and quantitative macroeconomics faces fierce competition, the immediate priority is to retain existing clients and prevent redemptions.

Li Bei's approach was to offer free online courses to all Banxia investors and free offline courses to investors who had held the fund for more than two years or had more than 5 million yuan in assets. Therefore, investors who wanted to redeem their funds before the courses started on January 24th were given a cooling-off period.

In November, Minghong's macro products sold out immediately upon launch; in December, Two Sigma's "CTA + Index Growth" composite strategy product's 2 billion yuan quota was snapped up instantly across three major channels. These multi-strategy products from quantitative private equity firms are, in effect, replacing Li Bei's macro strategies.

Moreover, with the decline of discretionary private equity sales through distribution channels and the avoidance of mainstream channels, discretionary managers will inevitably need to invest more energy in direct sales in the future.

One clever approach is to first filter out customers with the ability to pay from the 12,888 price range, and then use the slogan "Easily achieve a long-term annualized return of over 10% by taking classes" to target customers who are not satisfied with investment returns and are eager to get rich.

Fans with purchasing power and desire to buy can naturally achieve a high conversion rate of private equity clients with minimal time cost after receiving answers and explanations from Li Bei's offline lectures.

Astute managers not only make good use of the third type of leverage, but also excel at combining all three types of leverage.

end

When discussing the trend of paid knowledge services becoming a part of the asset management industry, many people think of two aspects:

• First, the pressure on employees due to salary reductions in the financial industry has prompted them to seek other sources of income.
• Secondly, shifting from investment to media is like a game-changer. This is why financial self-media is the top choice for most financial professionals seeking a side hustle.

But at a deeper level, this actually stems from the dual needs of investors and managers— investors need reliable sources of information, and managers need loyal clients.

It's like when Jensen Huang gives a speech at CES, and the next day there are dozens of interpretations of which sectors will benefit. While this seems to equalize information access, it actually increases a lot of noise. Advances in AI allow even more noise to be produced at low cost. For both investors and managers, attention and trust are the scarcest resources.

Who wouldn't want to spend some money to buy a professional fund manager's knowledge-sharing platform to gain information asymmetry, or even follow their trades? Many people know that Hong Hao's predictions often go wrong, but what they're buying isn't a 100% success rate, but rather the emotional anchor and comfort they can gain through his repeated analysis and confirmation in a chaotic market.

Some discretionary fund managers have gradually realized that they are no longer the first choice for institutions, distribution channels, and high-net-worth clients. Therefore, they can only work harder to reach more targeted clients through private channels and courses. Some top-performing discretionary private equity firms have already screened their clients to be executives or industry experts of their portfolio companies—helping clients make money while also gaining access to cutting-edge industry information from them.

I asked him why he didn't ask the sellers, and he replied that the sellers could only look at their own industry and mislead themselves, while the invested clients could tell me the most truthful and objective views on the industry.

When gold becomes increasingly difficult to mine and shovels become surplus, having a mining map becomes crucial, and those who sell maps become the most profitable people.