Exclusive Interview: How Waton Securities CEO Kai Zhou Plans to Democratize AI Trading
On July 7, 2025, Hong Kong-based Waton Securities – officially known as Waton Financial Limited (NASDAQ: WTF) – rang the opening bell at the Nasdaq MarketSite to celebrate its recent initial public offering . The company’s ordinary shares began trading on April 1, 2025 , raising about $20 million at a $4 IPO price. Waton is a securities brokerage and financial technology services firm, originally founded in 1989 in Hong Kong . Through its subsidiaries, it provides stock brokerage services (primarily for Hong Kong-listed securities) and also offers software and tech solutions to other financial institutions .
Today, Waton Securities remains relatively small in scale – it recorded roughly $10 million in revenue for the year ending March 2024 with about $2.5 million in net profit . Its market capitalization after the IPO has hovered around $250 million . Yet the company has outsized ambitions under the leadership of its young chairman, Kai Zhou, who acquired Waton Securities in 2021 and now holds a controlling stake. At just 29 years old, Zhou is among the first of the post-95 generation of Chinese entrepreneurs to helm a Nasdaq-listed firm . As both the architect of Waton Securities’s strategic transformation and its public face, Zhou’s vision is to leverage cutting-edge technology – especially artificial intelligence – to reinvent what a brokerage can be.
From Investor to Operator
Kai Zhou’s path to running a brokerage has been unconventional. After studying in China and Canada, Zhou began his career in investment. “I actually returned to China in 2017 and did a year of private equity investment,” he told Pandaily. This was the height of China’s internet finance boom, with startups in peer-to-peer lending and online finance attracting big funding. Zhou observed the frenzy but also recognized the pitfalls. “Internet finance was hot, but I knew there were many hidden risks and regulatory uncertainties,” he recalls . Wanting to participate in the sector’s growth without taking on its full risks, he decided to become a “picks and shovels” provider. In 2018, Zhou founded a financial SaaS (Software-as-a-Service) company, offering technology development and outsourcing services to fintech platforms . This venture proved successful – it gave Zhou his “first bucket of gold” and a network of clients that included numerous online lending and internet brokerage firms .
By 2019, a bull market in Hong Kong stocks was underway and IPO trading was especially popular . Zhou watched his brokerage clients thrive, and a new idea took shape: rather than just sell shovels, why not own a gold mine? “I come from a finance background, so in 2020 I thought, why not acquire a brokerage myself?” Zhou says. He identified a long-established Hong Kong brokerage – Waton Securities – as a suitable vehicle. In 2021, at the age of 26, Zhou acquired Waton Securities, executing a search-fund style entrepreneurship-through-acquisition . This move turned the investor into an operator, putting him in charge of transforming a traditional brokerage business.
Taking over an aging financial firm came with challenges. Industry observers often say “it’s harder to be a ‘takeover guy’ than to start a company from scratch,” and Zhou would agree the integration wasn’t easy . He became the CEO of an existing team with its own legacy culture, many of whom were older than him. Rather than enforce sweeping changes overnight, Zhou focused on winning the team’s trust and gradually aligning them with his vision. “I prefer to frame it as the team accepting me, rather than me changing the team,” he explains . Over time, as colleagues understood his ideas, everyone began “pulling in the same direction,” reducing friction and boosting efficiency . Zhou also wasn’t shy about investing in the business to earn buy-in: “You have to keep pouring in money – if there’s no milk, I provide the milk,” he jokes of his management strategy . With patience, open communication, and fresh capital, the young CEO revitalized Waton’s culture and prepared it for a new era.
AI as a Trading Partner
That new era arrived in 2023, when a technological breakthrough changed Waton’s trajectory. Zhou recounts how the emergence of advanced generative AI made a profound impression on him. “In 2023, GPT-3.5 came out globally. I tried it and was completely blown away – I felt this is the future,” he told Pandaily . Seeing the rapid progress in large language models, Zhou became convinced that artificial intelligence would disrupt most industries, especially investment and trading . He and his team made a bold decision: to go all-in on AI and pivot Waton into an “AI-first” company.
Zhou’s enthusiasm for AI is grounded in his philosophy of what makes a great trader. Even the most skilled human investors are ultimately limited by cognitive biases and emotions. “A well-trained trader still, at times, trades on intuition,” Zhou observes. Humans naturally develop “biases and path dependencies” – for example, the reluctance to buy back a stock you once sold at a lower price, because doing so feels like admitting a past mistake . These psychological factors can hinder long-term performance, and few people ever fully overcome them . AI agents, however, need not suffer from such baggage. Zhou argues that an AI, given the right training, can “absorb a person’s past strategies to refine and strengthen them, while also incorporating other viewpoints without prejudice” . In other words, an AI can learn from human experience without inheriting the human biases that come with it. Moreover, AI systems have vastly superior computational power and can process far more information than any individual. Thanks to these advantages, Zhou is “absolutely convinced” that in the realm of trading and investment, AI will play a critical role – potentially surpassing human traders in performance . Rather than view AI as just a tool, he sees it as a new kind of market participant or partner. “The future belongs to AI,” Zhou says unequivocally .
This conviction led Waton Securities to embark on a sweeping AI-driven transformation. In practical terms, the firm started reorienting its products and services around the idea of AI-assisted and AI-executed trading. By the time of its Nasdaq debut, Waton was branding itself not just as a fintech-enabled brokerage, but as one of the first brokers “for AI”. “Our aspiration is to become a pioneer in offering brokerage infrastructure that supports AI-driven participants,” Zhou proclaimed at the listing ceremony . “We believe AI is emerging as a new category of economic agent, and we are exploring how financial institutions can one day support such entities responsibly, in parallel with human clients.” In Zhou’s view, algorithms and autonomous trading agents may soon join retail and institutional investors as a third type of client in financial markets .
Looking Forward
With its “AI-first” strategy, Waton Securities is positioning itself quite differently from more established online brokerages. Take Futu Holdings, for example, which is one of China’s leading digital brokerage firms. Competitors like Futu have certainly begun integrating AI features – such as smart chatbots or AI-driven analytics – but mostly as tools to enhance service for their human users. Kai Zhou is flipping that model on its head: Waton’s focus is on serving the AIs themselves. “I think it’s very different,” Zhou says of his strategy versus peers. “Our industry peers are mostly looking at how to use AI to provide better service to humans, whereas we are looking at how to use our existing infrastructure and team to provide better service to AI.” In concrete terms, Waton is building out the capabilities for AI clients to act autonomously on its platform. “For example, we want to let AI open brokerage accounts, let AI execute trades, provide AI with market data and backtesting for its trades,” Zhou explains . By empowering AI agents as traders, Waton aims to cater to the trading needs of these non-human clients. “Our target customer is different, so I believe our strategies are completely on two separate paths,” Zhou notes of the contrast with conventional brokers .
This bold vision leverages Waton’s existing strengths in B2B services. Beyond its own retail brokerage business, Waton has been offering a brokerage SaaS platform – a cloud-based service for other small and mid-sized brokerages – known as its “brokerage cloud.” Traditionally, this platform provided client firms with ready-made trading apps and back-end systems, along with access to trading and settlement in Hong Kong, U.S., and mainland Chinese markets (plus related services like margin financing) . Now, Zhou plans to infuse the brokerage cloud with AI capabilities as a differentiating feature. In the near future, Waton will invite AI trading models onto its platform – essentially hosting AI-run trading accounts that can operate under Waton’s brokerage license . The idea is that if Waton manages to cultivate a large number of high-performing AI traders, “legendary trading AIs” as Zhou calls them, their expertise can be leveraged by all the human clients of Waton’s partner brokerages . For instance, a small brokerage using Waton’s SaaS could offer its retail customers the ability to follow or mirror the strategies of these top AIs, or to receive AI-generated trading insights tailored to the Chinese markets. In Zhou’s words, the AIs’ trading “movements” and analysis can be passed downstream to end-users, providing benefits like enhanced research, automated trade reviews, or even personalized trading tutorials . In short, Waton seeks to be the platform that connects cutting-edge AI traders with everyday investors around the world.
Zhou often describes this goal as “helping the world invest in China.” In our interview, he outlined a two-step roadmap to realize that vision . First, Waton aims to onboard a critical mass of global brokerage firms onto its platform, especially targeting those smaller brokerages that lack strong in-house tech – thus extending Waton’s network and distribution. Second, the company will develop a stable of AI-driven trading accounts that excel at delivering returns from Chinese equities and other assets. “When we have enough AI traders that can generate excellent returns investing in China, then end-users and institutions across various regions can, through the brokers on our system, get access to those AIs,” Zhou explains . By combining those steps, an investor in, say, Southeast Asia or North America could use their local brokerage (if it’s a Waton cloud client) to tap into the expertise of AI models specialized in China’s markets. This strategy not only differentiates Waton from the likes of Futu, but also aligns with China’s broader fintech trajectory – integrating AI to open new channels between global capital and Chinese opportunities.
Now that Waton Securities is a public company, Zhou is aware that the market will be scrutinizing the execution of this ambitious plan. The stock’s volatile journey – an initial 400% surge on IPO day followed by a steep comedown – reflects both excitement and skepticism around the “AI brokerage” concept. Yet Zhou remains steadfast in his long-term conviction. He acknowledges that Waton’s path is unorthodox and “not a road with a lot of people on it” . Many investors may not immediately buy into the idea of AIs as clients, and that’s fine by him. “Whether the market or investors recognize our philosophy – we don’t care… or rather, we can’t cater to everyone’s opinion,” Zhou says matter-of-factly . Instead, he insists the company will focus on “continuing down our path and let the results speak for themselves.” It’s a statement of confidence from a CEO who has bet his career on this vision. Indeed, Zhou holds about 86% of Waton’s shares post-IPO , so his personal skin in the game is enormous. He isn’t looking for a quick exit; rather, he talks in terms of decades. “If you ask me 5 or 10 years from now, I definitely plan to be doing this for more than 10 years… maybe much longer,” he says. Zhou even jokes that “if you lined up everyone in the world who’s bullish on our company, I’d be standing at the very front of that line.” Such boldness is characteristic of China’s new generation of fintech entrepreneurs. As Waton Securities steps onto the global stage via its Nasdaq listing, the coming years will test whether Kai Zhou’s AI-powered brokerage can fulfill its promise and perhaps redefine the industry’s future.