The help page for Error 000205 (Failed to create topology) states two possible causes, not including the one that took me several hours to figure out. Please add the possibility that the user could be using a license that does not include creating topologies.
Interestingly, it let me go through the Topology Wizard, setting rules, etc., but returned an error on "Finish". The error was resolved when I finally logged out of my work Esri account (in Pro) and logged in with my school account. (A side effect of working from home and using the same computer for both.)