Finance Magnates has learned that PipFarm, a Singapore-based retail prop trading firm, has launched a new pricing model that appears to be a departure from the standard industry playbook.
The model, dubbed “Pay with Profits,” will allow someone to pay a small upfront fee, as low as US$79, to access a simulated account.
The remainder of the cost is only settled if and when the trader achieves a payout, at which point the balance is deducted from their profits.
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Profit Now, Pay Later
In the typical prop trading setup, the firm’s risk ends the moment a trader’s credit card (or payment method of choice) clears.
By subsidizing entry, PipFarm is effectively extending credit to its users, betting they are good for the money in an industry where roughly 90% of traders eventually fail. If a trader never turns a profit, PipFarm is left to shoulder the costs alone.
So, how is the firm planning to offset that risk?
“When the trader gets a payout, we charge between 5-15x more, depending on the risk,” James Glyde, Founder and CEO of PipFarm, explained to Finance Magnates. "Essentially, they pay 5x less up front but 5x more later."
The strategy also brings to mind the "Buy Now, Pay Later" (BNPL) model used by fintech giants like Klarna or Affirm. Instead of installments, PipFarm simply defers the bill until payday.
"The simulated trading model changed how traders manage personal risk – a trader knows their maximum loss from the start, while the potential reward can far outweigh it," said Glyde. "We took that a step further. Pay With Profits lets a trader take on a larger challenge without committing hundreds of dollars upfront. The bulk of the fee comes out of their earnings, and only if they earn it."
The firm expects the model to find favour in low-income regions, such as Africa, South-East Asia, and Latin America.
However, would an entry fee as low as US$79 attract the YOLO crowd?
Whether this leads to a pipeline of untapped talent or a flood of low-quality traffic that strains the firm’s resources remains to be seen.
