Kalshi, a prediction market that lets people bet on future events, has raised a whopping $1 billion round at an $11 billion valuation, according to a person familiar with the deal. The round comes less than two months after the seven-year-old startup announced its previous $300 million fundraising at a $5 billion valuation.
The latest round is led by the company’s returning investors Sequoia and CapitalG, the person said. Other investors in Kalshi include Andreessen Horowitz, Paradigm, Anthos Capital and Neo.
Kalshi and Sequoia declined to comment. CapitalG did not respond to our request for comment.
Kalshi’s arch-rival Polymarket was reportedly in talks last month to raise another round of funding at a $12 billion to $15 billion valuation, just weeks after closing a $1 billion round at a pre-money valuation of $8 billion, Bloomberg reported.
Kalshi and Polymarket grew in popularity last year after both prediction markets allowed people to bet on the outcome of the presidential election. These betting sites became even more prominent after they correctly predicted the results of the New York mayoral election earlier this month.
For the Mamdani vs. Cuomo race, Kalshi bought advertising space on New York City subway cars, running live screens showing each candidate’s current odds of winning, a marketing campaign that undoubtedly increased the company’s brand awareness among New Yorkers.
Kalshi allows people in more than 140 countries to bet on various future events, from who will be named Time magazine’s Person of the Year for 2025 and the Rotten Tomatoes rating for the movie Wicked, to outcomes further into the future such as the next winner of the US presidential election.
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In mid-October, the company reached $50 billion in annual trading volume, a more than a thousand-fold increase from the roughly $300 million in volume recorded last year. New York Times was mentioned.
Kalshi was co-founded by two former hedge fund traders, Tarek Mansour and Luana Lopes Lara. The duo met as undergraduates at MIT while studying computer science and mathematics.
Prediction markets have historically been controversial and subject to legal challenges because they operate in the gray area between financial instruments and traditional gambling.
While Kalshi has secured the right of Americans to use its platform after successfully suing the Commodity Futures Trading Commission (CFTC) last year, the company is currently embroiled in legal disputes with several state regulators who claim its operations are illegal gambling.
Polymarket has been barred from serving US residents since 2022, following a settlement with the CFTC. In July, the company acquired a derivatives exchange and clearinghouse. The move helped Polymarket get the right to re-enter the US market. In September, the company’s CEO and founder, Shayne Coplan, told X: “Polymarket has been given the green light to launch in the US by the CFTC”.
