Tuanfang Liu
About Tuanfang Liu
Tuanfang Liu, 51, is Ispire Technology’s Co-Chief Executive Officer and Chairman (co-CEO since August 7, 2023; Chair/CEO since organization). He holds doctorate degrees in business management from Victoria University School of Management (Switzerland) and EuroPort Business School (Netherlands), and has 14+ years of e‑cigarette R&D and quality control experience . Under Liu’s tenure, FY2025 revenue declined to $127.5M from $151.9M in FY2024, gross margin fell to 17.8% from 19.6%, and net loss was $39.2M versus $40.8M in FY2024, reflecting a strategic pivot away from cannabis toward nicotine products and higher‑quality customers . He and his spouse collectively report beneficial ownership of 35.75M shares (62.57%) with Liu controlling 58.19% via Pride Worldwide Investment Limited, establishing “controlled company” status and shaping governance .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Ispire Technology Inc. | Chairman; Chief Executive Officer; co‑Chief Executive Officer | Chair/CEO since organization; co‑CEO since Aug 7, 2023 | Founder‑led strategy; product development and operations leadership . |
| Aspire Global | Chairman & CEO | Since organization | Upstream strategic control and coordination across affiliates . |
| Shenzhen Yi Jia | Chairman; 95% owner | Since June 2010 | Primary manufacturer/supplier for Ispire; major related‑party supply chain link . |
External Roles
| Organization | Position | Years | Notes |
|---|---|---|---|
| European Union E‑cigarette Association | Vice‑Chairman | Since 2019 | Industry leadership/advocacy . |
| Canada E‑cigarettes Association | Vice‑Chairman & Founding Member | Since 2019 | North America regulatory engagement . |
| China Electronics Chamber of Commerce | Vice‑Chairman | Since 2017 | China industry representation . |
| Shenzhen E‑Vapor Industry Association | Executive Vice‑Chairman & Founder | Since Oct 2017 | Standards and industry development . |
Fixed Compensation
| Fiscal Year | Base Salary (USD) | Bonus (USD) | Stock Awards (USD) | Option Awards (USD) | Total (USD) |
|---|---|---|---|---|---|
| FY2022 | $153,757 | — | — | — | $153,757 |
| FY2023 | $206,720 | — | — | — | $206,720 |
| FY2024 | $245,568 | — | — | — | $245,568 |
- Employment agreement (Jan 31, 2023): 5‑year term; auto‑renews year‑to‑year unless notice 60 days prior; annual base salary 1,920,000 HKD; bonus and any increases at Compensation Committee discretion; eligible for equity at Committee discretion .
- Salary paid in HKD; proxies disclose average FX used for USD presentation (7.8367 HKD/USD in FY2023; 7.8186 HKD/USD in FY2024) .
Performance Compensation
Program design (company‑wide): annual non‑equity incentives and equity awards (RSUs including performance‑based) intended to place >50% of target comp “at risk,” with performance criteria including return on net operating assets (RNOA) and total shareholder return (TSR); targets/weightings not disclosed in detail . Liu did not receive bonus, RSUs or options in FY2022–FY2024 per SCT .
| Metric | Weighting | Target | Actual | Payout | Vesting Terms |
|---|---|---|---|---|---|
| RNOA (company program) | Not disclosed | Not disclosed | Not disclosed | Not disclosed | Performance/RSUs per plan; time‑based RSUs also used . |
| TSR percentile (company program) | Not disclosed | Not disclosed | Not disclosed | Not disclosed | Performance RSUs; schedule not detailed . |
- Clawback policy adopted Nov 27, 2023; applies to erroneously awarded incentive comp in restatements per SEC/Nasdaq rules . Following FY2023/FY2024 restatements, no recovery was required because metrics underlying incentive comp were unaffected and no incentive‑based comp vested in the period .
Equity Ownership & Alignment
| Holder/Structure | Shares | % of Class | Notes |
|---|---|---|---|
| Pride Worldwide Investment Limited (controlled by Liu) | 33,250,000 | 58.19% | Liu is sole stockholder with voting/dispositive power . |
| Tuanfang Liu and Jiangyan Zhu (spouse) | 35,750,000 | 62.57% | Table shows combined line; Liu disclaims beneficial interest in spouse’s shares (held via Honor Epic International) . |
| Shares outstanding (May 9, 2025) | 57,145,455 | — | Basis for ownership % . |
Additional alignment/pressure indicators:
- Outstanding awards: No RSUs/options reported for Liu as of June 30, 2024 (no vest‑driven sell‑to‑cover pressure) .
- Hedging policy: Prohibits hedging and other speculative transactions, including short‑term trading, short sales, sales of borrowed shares, certain margin transactions, and trading in options/derivatives on company securities .
- Pledging: Not disclosed for Liu; policy excerpt references “certain transactions on margin” but does not explicitly disclose pledging status in available text .
Employment Terms
| Term | Detail |
|---|---|
| Agreement date/Term | Jan 31, 2023; 5‑year term; continues year‑to‑year unless either party gives 60‑day notice before term/extension end . |
| Base Salary | 1,920,000 HKD per annum; increases/bonuses at Compensation Committee discretion . |
| Equity Eligibility | Eligible for options/other equity at Committee discretion (no awards shown FY2022–FY2024) . |
| Location | Performs services at location he determines; anticipated PRC . |
| Non‑compete / Non‑solicit | Customary provisions . |
| IP Ownership | Company owns IP developed by Liu related to cannabis/cannabis‑related vaping; for tobacco/nicotine, Company has exclusive license worldwide except PRC/Russia . |
| Dual roles acknowledged | Also CEO/chairman/director of Aspire Global; CEO & 95% owner of Shenzhen Yi Jia; receives dividends from Shenzhen Yi Jia; Aspire Global and Shenzhen Yi Jia acknowledged IP provisions . |
| Severance/CIC | Not specifically disclosed for Liu; company notes severance arrangements exist for officers generally (no Liu‑specific terms provided) . |
Board Governance
- Roles/tenure: Co‑CEO and Chairman; spouse (Jiangyan Zhu) is a director, confirming family relationship on the board .
- Committees: Compensation Committee comprises independent directors (Burch, Cox, Fargis; chair: Cox); Liu may not be present when his compensation is deliberated .
- Nominating & Corporate Governance Committee: Includes Liu as Chair; because Ispire is a “controlled corporation,” the committee includes the non‑independent co‑CEO as member/chair alongside independent directors Cox and Fargis .
- Board/committee activity (FY2024 period): Board met 7 times; Audit Committee met 6 times; Nominating & Corporate Governance Committee did not meet; Compensation Committee did not meet; all directors attended the prior year annual meeting .
- Director pay policy: Outside directors receive cash retainers and fully‑vested quarterly common shares per updated policy (effective Oct 1, 2024). The director compensation table shows Mr. Liu received 0 stock awards (as an executive director) .
Related‑Party Transactions (Governance and Risk)
- Supplier concentration: The majority of Ispire’s nicotine/cannabis vaping products are purchased from Shenzhen Yi Jia (95% owned by Liu). Purchases were $91.3M (FY2024) and $83.1M (FY2023); related‑party A/P was $67.0M (Jun 30, 2024) and $51.7M (Jun 30, 2023). As of Mar 31, 2025, related‑party A/P was $77.1M; purchases were $17.95M (Q3 FY2025) and $79.51M (9M FY2025) .
- Pricing/terms review: Pricing determined by volume and “most favorable market price” offered by Shenzhen Yi Jia; no fixed payment terms; relationship reviewed quarterly; expected to continue if strategic objectives met .
- Ownership cross‑links: Liu and Zhu beneficially own 66.5% and 5.0% of Aspire Global; 58.2% and 4.4% of Ispire, respectively, as of March 31, 2025 .
Compensation Committee Analysis and Process
- Philosophy: Mix of base salary, annual cash incentives, and equity; emphasis on long‑term value creation with equity tied to multi‑year operating performance and TSR; >50% target compensation “at risk” for executives (program‑level statement) .
- Consultant/benchmarking: Korn Ferry engaged in May 2024 to provide executive compensation benchmarks; Board updated non‑employee director compensation policy in Dec 2024 to align near 25th percentile of peers .
- Equity plans: 2024 Amended & Restated 2022 Equity Incentive Plan with evergreen up to 5% annually through 2034; supports options, RSUs, PSUs, SARs, etc.; administered by Board/committee .
Performance & Track Record
| Metric | FY2024 | FY2025 | Commentary |
|---|---|---|---|
| Revenue ($M) | 151.9 | 127.5 | Strategic pivot from cannabis to nicotine; YoY decline of $24.4M . |
| Gross Margin (%) | 19.6% | 17.8% | Mix shift drove margin compression . |
| Net Loss ($M) | 40.8 | 39.2 | Loss persisted despite OPEX/investment shifts . |
- Regional mix FY2025: Europe up to ~$74.1M; North America down to ~$32.6M; APAC (ex‑PRC) ~$12.3M; Others ~$8.5M .
- Cost and credit risk: Operating expenses rose to $60.5M (from $43.7M) with a sharp increase in credit loss expense ($22.0M) tied to slower collections, while G&A ex‑credit loss declined modestly .
- Q1 FY2026 progress: OPEX reduced ~39% YoY ($12.9M→$7.8M), AR reduced ($62.4M→$44.5M), net loss improved ($5.6M→$3.3M), reflecting cost control and customer mix changes .
Say‑on‑Pay & Shareholder Feedback
- The company intends to hold say‑on‑pay on a triennial basis; board/committee will consider investor feedback if approval is low .
Director Compensation (context for board service)
| Director (non‑employee) | FY2024 Cash Fees | FY2024 Stock Awards | Total |
|---|---|---|---|
| Jiangyan Zhu | $92,088 | — | $92,088 |
| Christopher R. Burch | $48,000 | $36,000 | $84,000 |
| Brent Cox | $60,000 | $60,000 | $120,000 |
| John Fargis | $36,000 | $48,000 | $84,000 |
Note: Mr. Liu is an executive director and not covered by the non‑employee director plan; the table notes “Mr. Liu has received 0 shares of stock awards” .
Board Service History, Committees, and Dual‑Role Implications
- Service: Chairman and co‑CEO since Aug 2023; director since organization .
- Committees: Chairs the Nominating & Corporate Governance Committee (as a controlled company, this committee includes a non‑independent executive); not on the independent Compensation Committee .
- Independence/dual‑role: Dual role (CEO + Chairman) and family relationship on the board (spouse is director) reduce independence; mitigants include an independent Compensation Committee and Nasdaq independence for Audit/Comp committee members; however, the N&CG committee is chaired by a non‑independent executive given controlled status .
Risk Indicators & Red Flags
- Controlled company with concentrated insider ownership (Liu 58.19% via Pride; combined 62.57% with spouse) .
- Significant related‑party dependence on Shenzhen Yi Jia for supply with large and growing related‑party payables ($67.0M at 6/30/24; $77.1M at 3/31/25) .
- Financial restatements (FY2023 and interim FY2024), though no clawback recovery required under policy .
- Committee structure: Non‑independent chairing N&CG due to controlled status; Compensation Committee independent and excludes Liu from deliberations on his comp .
Investment Implications
- Alignment: Liu’s substantial equity control (58% via Pride; 62.6% combined line with spouse) strongly aligns with long‑term equity value but increases entrenchment and limits minority influence; executive cash pay is modest and no recent equity grants to Liu reduce dilution and sell‑to‑cover pressure .
- Governance/related‑party risk: Heavy reliance on Shenzhen Yi Jia (controlled by Liu) for product supply, with sizable related‑party balances, creates counterparty and pricing risk; oversight requires robust independent director scrutiny .
- Execution: FY2025 performance deterioration (revenue/margins) tied to strategic pivot; early FY2026 shows OPEX/AR improvements, but sustained profitability hinges on mix shift, credit discipline, and regulatory execution in nicotine markets .
- Monitoring priorities: Track related‑party transactions and credit losses, committee activity (Compensation/N&CG), and any future Form 4 filings or changes in Pride Worldwide’s stake, alongside say‑on‑pay outcomes as triennial votes commence .