How do prop firms make money? The business explained with numbers

In short: almost every futures prop firm charges for evaluations and pays the traders who pass out of that same money, because funded accounts are almost always simulated. That isn't a scam in itself. But it has consequences worth knowing before you pay.

Where the money comes from

• Evaluation fees: a one-time payment or a monthly fee per account.
• Resets, when you fail an evaluation and start again.
• Activation of the funded account, at firms that charge for it, and sometimes data or platform fees.

What matters is what's missing from the list: the market. Whether a firm can pay you doesn't depend on what you win from the market, but on taking in more in fees than it pays out.

Simulated or real?

According to Topstep's 2025 figures, only 0.71% of its Express Funded accounts went on to trade real money. Almost every payout comes from a simulated account, paid with the firm's money. Your "$50,000 account" isn't a $50,000 loan: it's a contract. If you follow the rules, the firm pays you a share of what you would have made.

The math, with an example

Hypothetical example, with the assumptions in plain sight: 100 traders buy, on average, 3 evaluations at $100 each (many try again: at Topstep, 16.8% of evaluations passed, but 51.8% of traders got funded at least once). Out of every 100 traders, about 7 get paid (FPFX industry data), with an average payout of about $2,000 and, let's say, 1.5 payouts each.

The example isn't far from the only public figure we know: an analysis of FTMO's accounts estimates that it pays its traders about 55% of its revenue. The margin is thin, and it depends on the share of traders who get paid staying low. If it rises, because there are more good traders or rules that are too easy, the firm loses money. That helps explain why rules change, why there are payout caps, consistency rules and minimum days, and why 80 to 100 firms closed between January 2024 and early 2026, according to Finance Magnates.

Do they want you to fail?

Not exactly you. They want few of all their buyers to get paid, and predictably so. With 14 out of 100 passing and 7 getting paid, the business works even if some traders are very good.

The conflict of interest is real, and it lies elsewhere: the firm writes the rules, decides on payouts and can change both. That's why, in public forums and reviews, the most repeated complaints are payouts denied or "under review" and rule changes.

What it means for you

1. Choose firms that pay fast and have been paying for years, with payout figures checked by someone outside the firm.
2. Read the rules of the stage where you get paid, not just the evaluation's: consistency, minimum days and caps. Here are Apex, Lucid, Tradeify and Topstep, explained.
3. Withdraw early and often. Profit in a funded account isn't yours until it's paid out.
4. Don't put everything into one firm.
5. Keep your trades and screenshots, in case you ever need to dispute a payout.
6. Work out your odds before you pay with the evaluation simulator: if you fail more often than you pass, you are the firm's business.

More on who gets paid and how much: Traders who get paid. And before you buy: five checks.

Sources

• FPFX Tech: 100,000+ traders at 10 firms (Fortunly summary)
• Topstep's 2025 figures (CurvedTrading review)
• Topstep: the firm's own figures
• Trade Informer: what FTMO's accounts tell us
• Finance Magnates: payouts and firm closures

Industry figures are estimates published by the industry or collected in reviews, not audited data. The example is hypothetical.

Educational content based on our own experience. Not investment advice. Firm rules change: check them on each firm's website. This article contains no affiliate links.