starting a prop firm !!!

Discussion in 'Prop Firms' started by andrasnm, Nov 16, 2001.

  1. Ok - just for the sake of a dialogue. Right, TI sold gadgets as any business.What's rare is the business model that self finances itself on the back of the <so called> partners !!! TI and Palm spent the money back on payroll, research expenses. Kanter had no expenses to speak off. He put up little money of his own.
    He lives in a rent controlled apartment in Manhattan and I have
    always thought Joe, his business partner can buy and sell him
    many times over !!!!
    He promised a note to some of his backers which was easily met
    by the business model. If you can find a business model similar to this, you should jump on it !!! I suspect now there are more players and he has a harder time to keep screwing people.
    He has changed his business model apparently the third time and
    try to go with the flow !!!! Bright at least sticks to what works
    and does not change 3 times in 9 years !!!!
    #11     Nov 16, 2001
  2. jem


    Take it from someone who in 1997 left bright because at that time it was cheaper for three of us to go out on our own and start a branch of a trading firm. We had asked for lower rates for a few months and their wasn't any movement. The day after we committed to starting the business putting up money and signing a lease, I noticed on my sheets that my seat fee was lowered and I had a commissions rebate. It was funny because had it happened a few days earlier I might be still trading with Bright. I had no problems with them and I thought the office manager was a good guy. (To me the choice of where to trade or even if you should be in a "pro" firm is no mystery; you just do a cost benefit analysis)

    Now while my new office did not cost me any more money than had I been at bright's old rates, it was losing money until my partner (we bought out the third guy) and I were able to train people to trade successfully. People losing their money trading do not generate enough trades at penny a share to make the business worthwhile.

    Hence, the demise of many many trading offices and firms (even with high ticket charges). Besides successful traders make for a enjoyable place to go to work. Prior to Bright I started trading at all-tech and everyone was losing money. That was a terrible work environment. A bunch of jaded traders losing money watching the new crop of traders being led to slaughter by a guy who was such a self-serving owner- trainer it was sad. ( I am talking about Barry not Rob)

    So if you can make good traders you have a viable business, but if you just going to open your doors you are going to have very thin margins if you try to be a low cost provider, especially if you do not have much established volume. Then again if you have the volume you probably know good traders and then you will find people willing to do business with you. I know plenty of people who will do business with guys who can trade.
    #12     Nov 16, 2001
  3. I think that you posted an excellent response, and (although sorry to have lost you), don't mind responsible competition that is good for the industry. Training is primary to growing a firm, and not the same old nonsense that is bantered about, but actual "this is what we did this week to make money" type of trading.

    Continued good luce!
    #13     Nov 18, 2001
  4. I am confused as to the post that says changing a business model is a bad idea. Andrasnm, I can tell by your posts that you are smart enough to know that that is what you consultants do, tell a business how to change to be better, right? It seems to me that businesses that don't change face obsolesence. Bright changed to an LLC, raised payouts etc. That's what makes Bright and those firms successful. All frims must change with the times. Isn't giving a third of the firm's overall profits back to the traders what you suggested should be done Andrasnm? Or should a firm just close the doors when conditions change? I am confused as to what this guy Joe has anything to do with Kanter and being able to buy him a few times over, what does that do? If someone can buy you over then they are superior, is that the implication?
    #14     Nov 18, 2001
  5. Take a hint, If you think you can somehow evangelize
    me and make me become a great ETG fan - you are sadly mistaken. Get this - I hope they go out of business ! I spent
    great number of months and capital to belive that they are a
    partnership !!! I have awaken !!! Given the new crowd and even possibly more LLC's are more open, more honest, less secretive - it's only a wish but eventually it may happen.
    Every change ETG makes is a different angle - a new way to
    obfuscate and confuse the new sucker !! They can't keep traders
    there !!! Now - I said it !!! Do you disagree with that too ???
    You using an alias is a telltale that you perhaps are still there !
    perhaps a manager ??? Use you own name and for fuck sake stop condescend and lecture me !! I don't fucking like ETG - deal with it !!!
    #15     Nov 19, 2001
  6. Wow. I can take a hint. You don't like me or ETG. As I said before, I am not a part of ETG. I left. I am not a big fan either. I am a believer in truth and fairness. We just have had two different experiences and realities. So be it. Please watch the language. Speaking of language what does obfuscate mean? I am confused.
    #16     Nov 19, 2001
  7. personally. I just don't like "spoon feeding" so called information.
    I have their number !!!!
    About keeping traders there true of false ???? No matter how many times they "change", reinvent themselves...
    I have some spies there even as we speak :)

    Good trading !!!
    #17     Nov 19, 2001
  8. dc441711


    I felt compelled to add my two cents here.

    I was most taken back by the comments of those, regardless of other feelings they may have toward a particular firm, who seemed to believe that opening up a business -- any business -- is a walk in the park. From dealing with support staff, the endless troubleshoooting, being responsible for paperwork, hiring, making sure there are staples in the office, compliance, to name but a mere few, I know form experience that running the day to day operations of an extensive operation is a mine field that you cannot imagine until you are going through it.

    Years ago, I decided to start my own law firm. With no reservations about my legal skills, nothing prepared me for never ending responsibilities of being the boss.

    Thus, even if you believe that certain posters here are "advertising", do not forget that obtaining clients is a major part of any endeavor. Further, to those of you who take acception to this, I believe you are in denial. The proprietors of these businesses, no matter what other altruistic motives they may have, are not running a charitable organization. You know the risks in day trading and you know the probabilty of success and the amounts that go to the "house."

    To begrudge these people from, if they are, doing everything in their power to promote their business is hypocritical. If you are serious about trading, as I am as evidence by giving up my law firm, then you have consciously decided to pursue an alternate career where you must in large part rely on your own skills and persevearance.You have consciously chosen independance iand entrepenearalship (sp?) as your path in life. Do not begrudge those who have set the path before you.

    Next, to the extent that your profitablity will depend on exceeding commissions is a known fact before you decide to accept this challenge. To complain about them after the fact is nothing more than a blatant failure to accept the consequences of your chosen actions.

    Finally, even if, as some suggest, certain individuals have posted on this board to bring attention to their firms, at no cost to them, that is called sound business, which is what this is. And to the extent that some have displayed disbelief that some charge for educational courses, perhaps you should not go. If you do not agree, perhaps you could share a skill you have with me over the course of a weekend. I will not pay you, but Ill serve some donuts.

    With all due respect to those who have launched offensive to certain proprietors in this forum and others, I do not know you and am sure you are nice people. But I am going to go out on a limb. While a normal human phenomenon, I suspect that those who are most vocal are the ones who were unsuccessful in their trading endeavors and instead of focusing within, they have chosen to displace thier negative feelings upon a failed system instead of focusing on what they could do differently to succeed.

    I hope that I have not offended anyone by this post as it was not my intention, but where each of us has chosen a path to take advantage of capitalism, it is quite striking to hear constant critisism of those who have succeeded toward this end.

    And, just to put this all in persepective, I began trading in the awful month of August, trading 100 initially and then 200 shares. I had no training or supervision of any kind. Before two monts passed, and depite the events of September 11, I was net positive over $2000. After two months passed, I encountered extreme problems, the subject matter of which is irrelevant. Among other things, there was uncertainty of my health, money I was counting on to get me through my training period would not be coming, I encountered serious family problems, and there were circumstances which lead me to come to work on numerous occassions without any sleep, once without having slept in over two days. While my losses are my own and I accept them, I know that these factors, in combination with numerous medications which clouded my head, turned me into a trader with an extensive winning streak into someone who could not focus on my computer. As a result, I went on a losing streak, which due to the fact that I was unaccustomed to failing, spiraled deeper. After another month, I was down $10,000. Ultimately, I knew that I had to take a few days off. Since I have returned, I have been postive every day. More to the point, I never quit and, while I find it hard not to feel cheated by these circumstances which were, in reality, largely beyond my control, I chose not to wallow, to forget about my losses and focus on making the money back, no matter how long it takes.

    What is my point? Candidly, I think I forgot. I kind of got carried away. Well, I am sure that many can take something relevant from this. :).

    This is my opinion
    #18     Nov 20, 2001
  9. I could not have said it better.

    I add one thing. It is one thing to not like a person, but when we get to the point of actually wishing them ill will, then I think we have stepped over the line.

    I have said all I am going to say about ETG unless directly asked a question. Let's work together to become better traders instead of fighting each other.
    #19     Nov 20, 2001