TradeInformer has learned that US prop firm Topstep generated revenues in excess of $25m in 2020 and 2021.
Chicago-based Topstep is generally regarded as the first ‘modern’ prop firm. Owned by ex-trader Michael Patak, the company was launched in 2012 and provides traders with the opportunity to get funded futures accounts.
Legal documents seen by TradeInformer show that the firm saw significant growth between 2015 and 2020.
Although the documents do not show the exact numbers, they state that the firm grew top line revenue 5x – 6x in that period, suggesting revenue was around $4m in 2015. Other data TradeInformer has seen would suggest revenue was approximately $5.4m in 2017.
Topstep ultimately made over $25m in revenue in 2020, with EBITDA of more than $3.7m.
In 2021, the company had already made over $25m by October 31st, suggesting overall revenue was ahead of 2020.
Topstep owner Patak paid himself over $5m in 2021
The documents also indicate that Patak was able to pay himself over $5m in 2021, suggesting either net income was higher than in 2020 or that cash holdings accumulated in the company were substantial enough that he could pay himself that amount.
Another interesting fact revealed in the documents is that the firm repeatedly tried to raise funds from outside investors and failed to do so.
According to the legal documents, Topstep’s former CEO Jay Rudman worked with an investment banker to try and secure investment in the prop firm. However, no interest was forthcoming and the company grew without ever getting outside investment.
Unfortunately no other financial data is available. However, looking at other companies like FTMO, it would not be surprising if Topstep has continued to grow significantly since 2021.
Assuming the prop firm’s growth rate was half of what it had been in the prior four years, we estimate revenue could have hit in excess of $50m last year.
