If you are reading this, then you probably want your brokerage to be a success. Many people rush into starting a brokerage, even already successful business people. The promise of quick and significant returns is too tempting for many. There is no such thing as a free pass to riches, and you will need to prepare yourself for this new venture. Read on if you would like to know more.
You will need capital
It takes money to get any new venture off the ground. Nobody should attempt to start a new brokerage until they are sufficiently capitalised. Even if you do not intend to run a massive operation with staff and fancy offices, you will need money to invest in your white label MT4 platform and market-leading services.
Most forex traders use the Metatrader 4 platform. It is pretty much the industry standard. The software is developed and licensed by MetaQuotes, and they are renowned throughout the forex industry. They charge a fee to anyone who sublicenses their software, and therefore, you will need capital to offer the white label version to your clientele.
Some entrepreneurs may be tempted to build their own proprietary trading software. That option could have potential, but this is a challenging way to get started in this industry. It is tough to sell an unknown trading platform to traders who know and trust MT4 already.
Pro-tip: If you are under capitalised, a more straightforward and more practical solution is for you to become an introducing broker. Once your IB network is generating a monthly volume, you can transfer your client accounts to your own white label brand.
You may have other successful businesses or have qualifications in different fields. However, the forex industry is a complicated beast, and you will need to be up to speed with its nuances very quickly.
Most new forex businesses fail within the first few years because it takes them far too long to understand what makes one work and how to avoid the potential pitfalls and headaches associated with it. The only way a forex business can succeed is by having the experience (or at least having access to that experience), and a strong work ethic. If you ignore this point, you might as well flush your hard-earned cash down the toilet.
Popcorn technology has a start-up team that is eager to help new brokerages succeed. Besides providing all the tools a start-up brokerage needs, they also offer sound advice to help you hit the ground running.
Even if you have the money and the necessary business knowledge, there is still one other essential piece of the puzzle that needs to be resolved before you ever think about starting your brokerage.
You need a plan and a unique element to your service. It would help if you had an idea to help you stand out among the competition. The forex industry is a hyper-competitive market.
It is not enough to put your logo and slogan on an existing piece of software; you must have a unique angle to win over customers like a live chat room or professionally managed accounts. Your clients need an incentive to join your business.