How Prop Firms Really Pay Traders (And When They Don’t) | Ep. 325 with Martin Jensen and John Ramos CEOand CTO of Prop Firm Match

And I'm an avid trader in the sense of I've been trading different things from stocks to crypto to other things throughout my my lifetime. I remember when I was in elementary school and my teacher gave me here's some fake money, put it into some stocks and then we had a contest. I interned put that money into the stock.

And that's actually how I bought my first car back when I was 16 years old.

So I'm always fascinated with new things and John and Martin, you both are going to walk

us through exactly what is prop firm match doing and what we need to know. So let's first off by that what is prop firm match. Thank you for that introduction. So prop for match is a platform that compares prop firms. For those not familiar with prop firms, prop firms is a kind of company that let's trade

us trade with more capital than they have on their own. So it's a way to for profitable traders to leverage their skills and trade with notably more capital than what they have access to on their own.

Prop for match compares the best prop firms and have a strict vetting process to ensure

that the prop firm is solid that it's has to write backing both in terms of the team and the funding and do comprehensive vetting of the firm before we decide if we're going to list it or not. So traders know that they find on the best prop firms and can compare 200 best ones for them on our platform.

“And what's ever trading is somebody doing where they need a prop firm?”

I would say most kind of really any kind of trading. You have prop firms that you have four extra prop firms, your futures prop firms, your crypto prop firms, you have stocks, prop firms, so regardless of what kind of assets you trade, there is prop firms on that fits. And what is the importance of having a prop firm?

Can you give me some more details around that? Like, me, I'm new to this, I want to jump in. Why do I really need a prop firm? And then when I'm looking at it, because obviously you all are doing a lot of analysis,

“I imagine you have a lot of data, what makes a good one versus one that's not as good?”

So to answer the question about why you need a prop firm?

First of all, it depends on you.

There are traders who have a lot of capital to trade with and don't necessarily need to leverage their capital a lot, but likely 99% or more of those who do any kind of trading has too little capital to make a living out of it, or make a good side salary out of it, where prop firms let you go in with less capital. And if you have the skills, this is like any kind of trading, there is no magic formula.

You have to be good. It's only a small percentage that succeeds, but if you are among the best of the best, it's an opportunity to leverage your skills and more. So there are several things that decide if a prop firm is good or bad.

“The most important thing is to pay out reliability, you have to know that if you follow the rules”

and you receive, or you accomplish a pay out, you are actually getting a pay out. And that's not a given with profits that are not verified, that are not solid. So that's where prop firm match ensures that we vet the profits concurrentively to ensure that the traders can be the safe form on that aspect. Then there are several differences when it comes to pricing, when it comes to the rules,

that the different packages have, in terms of how much profit you need to make. And so on. So without coming too much into the details, there is a lot of variations between the firms and also the somedity of the firms that we try best to cover very comprehensively on our platform.

So I remember when I first started trading, I needed $25,000 just to be an intraday trader

to day trade basically, which means just going in and out of trades multiple times a day. You needed a certain threshold and prop firms, the barrier to entry, the barrier to start trading and potentially make profit was much lower, where it's, you know, you pay at one time fee, it may be $100 to get access to a specific amount of capital, or you pay subscription fee. Personally, I use a subscription model for futures and I pay around $80 a month.

“I think it's $89 and I have access to $50,000 if I pass the test.”

So with prop firms, what you do is you get like a test and if you pass it, you get access to make profit with a certain amount of capital. And the other reason I like prop firms is because trading is a bit of a difficult sport. So it takes time to get good and rather than risking your own capital, like let's say

I were two going to the market with $25,000 and I'm not a good trader yet.

I could essentially risk that $25,000 and doing things like over trading or things that the traders are susceptible to, which revenge trading or going until trading emotionally, all those things, but if you pay a one-time fee and, you know, you fail the challenge, you know, okay, I just invested $50, $200 and I lost that investment. Maybe I need to refocus, rethink how I trade and do better the next time.

So I have a bit of skin in the game. I want to do good trading, but if I lose that investment, I know it's not going to be the end of the world. So that's why I like prop firms. You know, you put a little bit of investment, it tests your skills, and if you pass the test,

you pass the challenge. You get access to a lot more capital to make profit of that kind of leveraged capital that you get. Got it. So it's trying to manage the risk as what I'm hearing.

What are some things that people need to really look for when they're getting into this? What should they? What are the dangers? Like you were just saying some, John, like you could without it, you could spend money, and then you lose all your money and you make emotional trades.

Are there any sort of dangers that people need to look out for when they're getting into this type of trading or when they're leveraging profits in trading? Yeah, just to follow up on that thread, I would say the risk is finding a profit from that doesn't pay you if you do well.

“That's like the worst thing that could happen.”

And that's why I prop firm match exists. For traders that put their hard time, their effort, even their money, even though it's not as much money, but they put their money, their time and effort to get good and pass a challenge. If at the end you pass and you make profit and you don't get paid, that's the worst.

So that's why I prop firm match exists. So we only list the most reputable firms that will pay traders if they make profit with after passing a challenge. So I say that's the biggest risk, but it's a smaller risk than let's say putting up $20,000 and not being a good trader and $20,000, not being a good trader and then losing

it all. So you know, pro firms is a very in the trading world, the trading industry, pro firms are, I'd say they're growing because the business model is attractive, low barrier to entry. And if I'm a good trader, I get access to more capital capital and I get to profit on that.

Based on what's happening right now in the world, what's going on in different industries, you obviously are seeing what people are doing and you have some, I imagine some good data

“that you're tracking, what types of trading are people looking at right now in this moment?”

So we don't have any trading data, the data, the trading isn't happening with us. But what we do know, we do know which, which take us an instrument's people trade. And currently gold is the most popular pair in the industry. Gold is heavily traded. We have now had a lot of volatility in oil the recent days.

So traders go off the volatility. So whatever moves, you will see increased trading at the end and in addition to...

To the pair's data, always well traded, such as the YanQ and the Euro and so on.

Commodities and metals are traded in the capital of these days. When you all got started, what was the thing that sparked when you're like, we have to do this?

What happened in your life that made it steered you toward this and why did you co-founded together?

Yeah. So what happened, was that both John and me were full-time traders? At that point I had been trading for for six years. And we're at the point where I was doing well, I was consistently profitable and had been that for quite some time. But I struggled scaling up, so I made enough money to make living, but not enough to scale up my trading.

And one of the fascinating things with trading is that what you do with little capital

“is exactly the same thing that you need to do with very capital.”

As long as you trade liquid instruments, the only thing that's different is the psychology,

which is a big factor, but the actual clicking of buttons and strategy can be just the same, just with much more skin in the game. So I got over the concept, I heard about the concept of prop films and were really intrigued by that on a personal level to scale up my own trading. So I reached out to John, who had the same passion for it. And when we were looking for prop films, there were really difficult to find out which prop films that were reliable,

which were confident would pay out. And so on also to know which films that suited our style, there were no such tools. So we decided to build it, knowing that there had to be a lot more traders than just the two of us in the situation. So we decided to build a platform where we would showcase just the best films and show objective metrics. So traders could use that to base their decision on.

So that's where it all started. Yeah, Martin, we were part of the same trading community, and we met there, and yeah, we had the same Martin pitched the idea, and I was like this, this makes a lot of sense, and I was using a prop firm at the time. Time, it's still empty. A lot of traders in our community were using prop firms. So yeah, I was kind of a no brainer for me, and I had the technology to build kind of the initial site and the things we needed.

So Martin and I, we got started pretty much right away. So it sounds like the business thrives on community, or it kind of creates a community, because you're in a community.

I know that the trading community is always very strong, and I like that people collaborate with one another and they want to win together.

“So when when you had this scale and as you're growing this business, sounds like you have to cultivate the community because that's a part of it.”

Obviously, there's also a lot of trust involved, because people need to trust you. I think always in any trading space. Trust is huge, transparency, like all these things are important. How, as you've grown in scale, have you consistently tried to also uphold those things at the same time? So as you're saying yourself, the trust and transparency is key for us. So when we launched in 2020, three, one of the things that made us different from the sites that were around the comparing

profiles was that what we put on the site were only based on objective metrics, and that model is something we have. Hold steady sense, sense them. We don't do any besides the initial vetting of the firm. We don't do any reviews. There was no way for the firm to to pay themselves to a good rating or anything like that. So we showcase the objective facts, what it costs, what the profit targets are, and so on. And then instead of us doing any kind of reviews, we let traders to the reviews.

So we have a system where our support is verifying every single review manually. And the trader has to have been traded with the firm. So we verified that they actually have been trading with the firm. So it's really experiences. So now we have almost 10,000 verified

“reviews from traders that have been trading with the various firms on our site. And that's what”

makes up the rate things. So we are taking ourselves out of the consideration of what's the best

that we showcase. Yeah, and you mentioned the idea of community. And I think that resonates with us in a specific way, like Martin and I coming from a trading community, understanding the hardships of trading, understanding the successes of trading, all that factors in, maybe I don't know subconsciously or consciously into how we run the business, because we run the business with ourselves in mind, which is where traders, what do we want to see as traders, what do we want to uphold as traders,

“how do we want to communicate with traders. So that is something I think we both hold very dear.”

And it makes coming to work every day, exciting for me, because trading is a bit of a passion. It's something that I've put a lot of hours into. And running a business that's aligned with traders, is something that I like to hang my hat on, something that makes me feel good about what we're doing and providing that transparency in the industry. When you look at the marketing that you've had to do in order to get to 10,000 reviews is a lot. And it's only been a couple of years. What has been

one or two marketing strategies that have helped you? When we first started out, we had to find

a way to be seen in the infraction. So what we did even before we launched was to launch a Twitter handle where we started the marketing before we went live. And we found a way into the industry, where we made a fun competition between various problems. We made it like a championship where problems battled against each other. And we compare them in different metrics where one would come out ahead. And we had the community vote and it became a big event in the industry.

Just like a world cup where we ended up with the final. And that's something we did even before we launched, which gained a lot of traction. So we had a flying start when we did a launch a few

“months after. So I think that's important to be creative and find out how you can stand out”

and how you can make a market, especially when you are new and need to be seen. After that, we have focused on building the brand-building business with things we have discussed in mind, with transparency and trust. And things have come naturally from that, as we have the I grown from sunny out with John and I to now being about 80 people team in tune of year.

That's incredible. Again, two and a half years. The great thing about what you're doing is

it's very unique. I almost want to say it's like a niche thing because it's not it's not so big that 8 billion people on the planet know about it. But it was a major problem that you saw that

“no one really had solved before. And I think it's hard. I think it's nowadays hard to find”

a lot of problems that need to be solved in many industries because so many have been. So most people are kind of like redoing what's already happened. Like, oh, this is a problem. It's not a major problem. And they're just redoing it. But you found a major problem in something you were doing, which is very unique. And that's a great story. What has had to change in the two of you?

I mean, your co-founders, obviously, you know, amazing parts and complexities around having

just co-founders in general and then growing to 80 people. So what's had to change in the two of you, whether it's your leadership skills, your mindset, whatever that is, that's had to do this as you've gone to where you are now. So when we start out, we were two. And that's just touched on. We are now a lot more. And that's a huge difference, obviously. And things have gone really, really quickly. So what we, where we when we started out and also with a small team,

we could be, we didn't need a lot of processes. Things, we got an idea and we went quickly to execution. Whereas now we have more people to relate to. We need processes for what we do to be

same mindset. We want to be able to move quick. We want to have the fun of a startup, but still

“introduce more processes and make sure that we have a model that's scalable, that's less dependent of,”

of John and me. So that's an interesting challenge that we are in the middle of as we speak. Yeah, as the company grows, there's more people to talk to. There's yeah more processes. But it's really enjoyable. We have a great team, really like communicating with everyone on the team.

But yeah, when we had Martin first started, it was like, you know, things moved very quickly.

And things still moved fairly quickly, but it is with more people. There's more communication, more people need to know things. So things tend to move in a more process type way.

“Yeah, the agility changes when, like you said, when you have more people you have to think about,”

could you might have investors? You have to think about you. There's a lot of things you need to think about as you grow in scale. So you can't move as quick, but you can still move quick more thoughtfully. And I love the processes and procedures. That is something I think a lot of entrepreneurs

were like driving 100 miles a second. And we sometimes forget that if we had a process in

procedure, it could make life easier. Also, if we have employees that leave or change, then they can just

“easily pick it up. It's sound so simple, but I think so many people do forget to do that.”

But if people want to get in touch with you guys, they want to find out more information. How can they do so? All right. So to find out more about us, go to pro from match.com. That's where you can find out more about the team as a whole, but most importantly for the traders watching the information about pro firms as a whole and the various pro firms that we that we list. We also have accounts on on X and Instagram, YouTube, every social media that

that is out there. We post a lot of valuable content for pro firm traders with details around pro trading as a whole and also various pro firms. Well, Marit and John co founders of pro firm match. I learned something new today. I don't know everything, but I've definitely learned a lot over the years. And I do like it when I can talk to some people doing something that I don't know yet. And it's unique. And I learned a lot. So I appreciate your time today. And thanks for joining us

on founder's story. Thank you. Thank you for having us.