US IPO Preview | Hao Feng Group: Leveraging the "Big Pool, Small Fish" Landscape in Financial Education, Revenue Growth and Business Diversification Pay Off

Title context: US IPO Preview | Hao Feng Group: Leveraging the "Big Pool, Small Fish" Landscape in Financial Education, Revenue Growth and Business Diversification Pay Off Text: Recently, Hong Kong investment education service provider Hao Feng Group Ltd. (hereinafter referred to as Hao Feng Group) submitted an F-1 prospectus to the U.S. Securities and Exchange Commission, planning to issue 3.2 million ordinary shares at $5 to $8 per share, listing on NYSE American under the ticker "HFE." Based on the median offering price, the post-offering market capitalization is approximately $151 million. Eddid Securities is acting as the sole book-running manager. The company had previously filed its application documents confidentially on April 10, 2026. Driving Revenue Growth by Compensating for Price with Volume According to the prospectus, Hao Feng Group was established on January 13, 2012, and is one of the few leading players in Hong Kong's highly fragmented investment education market with the ability to generate revenue at scale. According to an industry report by Barentsz & CRI, based on 2024 revenue, the company ranks third among investment education service providers targeting retail investors and high-net-worth clients. The company conducts its substantive business through its wholly-owned operating subsidiary Hao Feng, positioning itself as an independent financial education teaching center. Its curriculum covers five core modules: financial markets, stock trading, portfolio management, fundamental analysis, and investment strategies. It adopts a hybrid delivery model of "offline in-person teaching + online live/recorded courses + thematic seminars." Its revenue sources are strictly focused on the financial education segment, consisting of regular tuition fees (primarily annual subscriptions) and seminar fees, with clear business boundaries. After years of operation, its annual subscription user base has achieved steady compound growth, providing a highly predictable existing customer base for revenue. Financial statements show that in fiscal years 2025 and 2026, the company's revenue was $686,300 (unit: USD, same below) and $930,200, respectively, representing year-over-year growth of over 36%. Notably, gross profit performance outpaced revenue, with gross profit reaching $823,400, up 39.5% year-over-year, and gross margin rising slightly from 86.0% in the prior-year period to 88.5%. This indicates that the pricing power and high-margin attributes of its core course products are prominent. Breaking down the business structure, revenue from on-site education services reached $766,000, up 14.6% year-over-year, but its share of total revenue dropped from 97.4% in the prior year to 82.3%. Notably, the number of students increased from 416 to 493 (+18.5%), growing faster than revenue growth (14.6%). Based on this calculation, the average revenue per user (ARPU) for the period was approximately $1,553, a slight decline of about 3.3% from $1,606 in the prior-year period. This suggests that during its IPO sprint, the company may have proactively adjusted its pricing strategy or course product mix (such as introducing entry-level courses), shifting from a previous "price over volume" approach to a customer acquisition orientation of "compensating for price with volume" to expand its user base. In addition, advertising services generated $128,200 in revenue, accounting for as much as 13.8% of total revenue, making it an emerging business. Subscription-based digital content revenue grew 98.5% year-over-year to $36,000, accounting for 3.9% of total revenue. Although the growth rate doubled, the absolute base remains too small to have formed a substantive second curve. Setting aside the revenue side for now, the profit side is indeed underwhelming. During the period, profit fell from $402,000 to $203,000, nearly halving. The culprit behind the plunge in net profit is fully exposed on the operating expense side. Total operating expenses surged from $125,900 to $546,900, an increase of 334.5%. Among them, general and administrative expenses - third party soared from $96,000 to $504,100, up 425.3% year-over-year. At the same time, although sales and marketing expenses doubled to $11,500, up 115.2% year-over-year, the absolute scale remains extremely small, indicating that the company is not currently adopting a burn-money-for-scale strategy, and growth still relies heavily on the organic conversion of the founder's IP. In short, Hao Feng Group's business diversification trend in 2026 is evident, as it makes initial explorations in transitioning from a "single-IP education service" to an "investor traffic platform." The breakthrough in advertising business is the biggest highlight, effectively hedging against the slowdown in the education business caused by the slight decline in average customer spending, and validating the cross-sector commercial value of its user assets. However, advertising revenue is inherently highly volatile, and vigilance is needed against excessive commercialization diluting the professionalism of the education brand. Hong Kong's Financial Education Track: "Big Pool, Small Fish" Hao Feng Group operates in the niche track of Hong Kong financial education, a "big pool, small fish" market. On the one hand, there is room for growth on the demand side of the industry. According to the prospectus, demand for financial education will continue to grow, driven by the expansion of different demographic groups. High-net-worth individuals' demand for professional wealth management and digital asset courses is increasing. At the same time, the younger generation and new immigrants are increasingly focused on basic financial literacy and investment skills, which together create new growth opportunities for the financial education market. Hong Kong's financial education market was approximately $1.054 billion in 2024, with a compound growth rate of only 3.9% from 2022 to 2024, showing flattening growth. However, CRI predicts that the CAGR will rebound to 7.8% from 2025 to 2034, with the market size reaching $2.233 billion by 2034. It is worth mentioning that Hong Kong's per capita wealth grew 1.5% to $601,000 in 2024, with median wealth of $222,000 ranking fourth among major global cities. At the same time, the increasing complexity of financial products and the lowering of participation barriers by fintech have created a cognitive gap of "easier to participate, harder to understand," continuously releasing demand for systematic financial education. Individual investor education accounts for 75.6% of the market, with a scale of approximately $797 million in 2024, which is precisely Hao Feng Group's core target market. On the other hand, Hao Feng Group's awkward position in the competitive landscape lies in this - high ranking, extremely small scale. Among approximately 54 active financial education institutions in Hong Kong, private financial education centers account for only about 18.5%, making the industry extremely fragmented. Hao Feng ranks third in revenue with a student base of fewer than 500, indicating that there is still a distance between the "top" of this track and true scale barriers. In summary, the core of Hao Feng Group's future development lies in whether the company can, while maintaining the founder's IP premium, migrate its teaching model from "personal instruction" to a "replicable curriculum system + digital delivery capability," thereby truly participating in the distribution of the industry's 7.8% incremental growth. From current data, digital subscription revenue accounts for only 3.9% of total revenue, advertising monetization has just begun, and the transformation is still at a very early stage.