Vest Labs Completes $13 Million Seed Round Financing
Retail proprietary trading startup Vest Labs announced the completion of a $13 million seed round financing, led by Portal Ventures, with personal investments from executives at Citadel Securities, BlackRock, and KKR. The round closed in July and was announced this week, with the company not disclosing its post-financing valuation.
Vest allows qualified traders to use company funds to trade perpetual contracts in real markets around the clock, retaining up to 80% of profits, with the remainder going to the company. The founders state that this aligns the company's earnings with traders' profits, rather than relying on fees from simulated account assessments to cover losses.
The company is based in New York and was founded by University of Pennsylvania dropout Justin Ma, Rikuya Takatsu, and Maximilian Tsiang. Ma previously sold an early trading app, Berri, and used the proceeds to enter crypto trading and establish Vest; during the 2024 Stanford Blockchain Conference, he met Portal Ventures General Partner Catrina Wang at an alumni event, which initiated discussions for this round.
The funds will be used to develop a mobile app, expand the current team of 22, and increase the variety of assets available for trading around the clock. In contrast to retail proprietary firms that charge fees before issuing simulated accounts, which receive fees regardless of user success or failure, Vest only takes its share after real profits are made.
The company disclosed that as of late September, 26% of approximately 27,000 traders on the platform had received cash payments, with monthly active traders and trading volume both increasing by over 300% month-over-month. Proprietary futures firm Topstep reported that about 17% of its assessments were completed in 2025, with only about one-third of traders who received funding having ever received payments.
The buyers are the leading fund shares from Portal Ventures and personal checks from executives of the three institutions, not on-balance sheet funds from these firms. The seller is Vest's seed equity. The transaction is driven by a profit-sharing model: the company provides the capital, the traders place orders, and profits are split 80/20, with losses initially absorbed by the company's funds. Beneficiaries are traders who can pass qualification screenings and continue to profit, while those under pressure are the simulated trading firms that still rely on assessment fees, as well as Vest itself, which must prepare capital for real trading drawdowns.
The 27,000 traders and 26% who have received payments indicate that profit-sharing has occurred, but the 300% month-over-month increase comes from the company's own metrics, without providing a base figure or drawdown. The seed round valuation has not been disclosed, and personal investments do not equate to equity stakes from Citadel Securities, BlackRock, or KKR.
Source: Public Information
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The old ledger of retail proprietary trading is assessment fees. Institutions like FTMO and Topstep charge challenge fees upfront, then set drawdown rules in simulated accounts, with most failing to pass, allowing the company to collect fees regardless of user failure. The U.S. Commodity Futures Trading Commission's action against MyForexFunds in 2023 targeted the structure of "nominally providing funds, but actually relying on fees and restrictive rules." Vest has written this comparison into its financing narrative: the other side bets on failure, while it bets on success.
The capital path stops at personal checks, not entering the balance sheets of the three institutions. Portal Ventures led the $13 million investment, with only the names of executives from Citadel Securities, BlackRock, and KKR appearing. The funds are intended for mobile development, the 22-person team, and more tradable assets, not for purchasing exchange licenses. What the company is really putting up is trading capital: traders can take home up to 80%, with the company retaining 20%, and there are no assessment fees to dilute drawdowns. Ma's proceeds from selling Berri were used for early trading, indicating that the founding team first validated their trading with their own exit funds before converting institutional connections into seed checks.
Comparable is Topstep's publicly disclosed funnel: about 17% completion rate for assessments in 2025, with about one-third of funded traders receiving payments. Vest reports that 26% of 27,000 traders have received cash payments, with different metrics making direct comparisons impossible, but indicating it aims to use payment rates rather than registration fees as growth indicators. The industry position is in the early stages of transformation: the product has real profit-sharing, capital is still in the seed round, and valuation remains undisclosed.
This is a reconstruction of the industry chain. The mechanism changes the income of proprietary firms from "registration - failure" to "funding - profit sharing." The pricing power of simulated trading lies in rules and fees, while the pricing power of real profit-sharing lies in who bears the losses. Once the company places real orders, traders' profits are no longer a cost; drawdowns become the cost. Personal checks can provide endorsement but cannot lend the risk control frameworks of market makers and asset management firms to a 22-person seed company.
ABAB News · Cognitive Laws
Businesses that charge based on failure will have rules skewed towards failure.
Profit-sharing may seem aligned, but losses are still recorded against the funding party.
Personal checks are endorsements, not part of institutional balance sheets.