Lately, prop firm companies have appeared here and there.
Basically, you can pay to receive 5-6 digits of a trading account, prove yourself a consistently profitable trader by taking the evaluation, then be given “live” trading account (from $10,000 to $300,000), and any profit will be split with you (you get 70-85%).
But nobody actually knows about how they work since there isn’t any insider info coming out yet.
People say they actually made money by collecting registration fees, and the profit split to profitable traders is actually other people’s registration fees, since the number of profitable traders actually only count for 1%-ish. Something like a money game (variation of a Ponzi scheme?).
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The prop firm companies are funded by venture capital who are just there to make a profit on their investment.
Having a series of barriers to entry for potential traders ensures a reasonable “business model” from each successful trader as well as an income stream for “training” for each unsuccessful trader.
Successful traders are kept so long as they are successful and there is a steady flow of new successful traders and revenue from unsuccessful traders.
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