What it means
Read the rules carefully: most participants don't pass.
In practice
A prop firm offers a larger account in exchange for a fee and proof of discipline. Traders must reach a profit target without breaking a daily loss limit or a maximum drawdown; those who pass keep a share of later profits.
For a trader with a tested method and little capital, it limits the money at risk to the fee.
What to watch for
The rules decide everything: how drawdown is measured, whether it trails open profit, limits on news trading and when payouts are made. Most people fail, often by rushing to hit the target, and the fees add up.