▼ Summary
– The CEOs of rival prediction market companies Polymarket and Kalshi are both investing in a new venture capital firm, 5(c) Capital, founded by former Kalshi employees.
– The fund, named after a regulatory clause, is raising $35 million to invest in about 20 companies focused on prediction market infrastructure.
– Notable investors in the fund also include prominent figures like Marc Andreessen and Ribbit Capital’s Micky Malka.
– Kalshi is currently raising funds at a $22 billion valuation, while Polymarket is in talks for a round that would value it at $20 billion.
– The fund aims to back companies that can capitalize on the broader effects of the growing prediction market industry.
Even as they lead two of the most prominent and competitive platforms in the space, the CEOs of Kalshi and Polymarket are aligning their capital behind a new venture. Tarek Mansour of Kalshi and Shayne Coplan of Polymarket are both investing in 5(c) Capital, a new venture firm dedicated to betting on the broader prediction market ecosystem. The fund, named for the regulatory clause governing these markets, is targeting a raise of $35 million for its inaugural vehicle.
This strategic convergence highlights a shared belief in the sector’s expansive potential beyond the core platforms. According to reports, the fund’s investment thesis focuses on backing founders who aim to capitalize on the secondary and tertiary effects of the prediction market boom. The plan is to invest in roughly 20 companies, with a focus on critical infrastructure components like market makers and index designers.
The firm is led by partners with deep roots in the industry. Adhi Rajaprabhakaran was a trader at Kalshi, while Noah Zingler-Sternig served as the company’s head of operations. Their venture has attracted a notable roster of backers beyond the rival CEOs. Marc Andreessen is reportedly investing through his involvement with Moneta Luna, and Ribbit Capital founder Micky Malka is also a participant. Kalshi confirmed Mansour’s investment, though Polymarket declined to comment.
This collaborative investment comes at a moment of intense growth and valuation escalation for both leaders. Kalshi is reportedly in the process of raising $1 billion at a staggering $22 billion valuation, which would double its worth from just four months ago. Not to be outdone, Polymarket is said to be in discussions for a new funding round that could value it at approximately $20 billion. This parallel surge underscores the fierce contest for market leadership, even as their CEOs jointly fund the ecosystem’s future.
(Source: TechCrunch)
