Kalshi raises $1B at $40B valuation, doubling May's price tag

What's the deal? Prediction market Kalshi has closed a $1 billion Series G round at a $40 billion valuation, co-founder and chief executive officer Tarek Mansour said. Sequoia Capital and Wellington Management led the round, with Baillie Gifford, Morgan Stanley Investment ManagementDealroom has a profile for this one. Try Dealroom →, Coatue Management, and Andreessen Horowitz also participating.

Why now? The raise nearly doubles the $22 billion valuation Kalshi fetched in May and vaults it past rival Polymarket, last valued at about $21 billion. Prediction markets, where users trade contracts on outcomes like elections and sports, have surged in popularity over the past two years.

What's the endgame? The money funds Kalshi's product roadmap for retail and institutional users, Mansour said. The Series G is widely expected to be its last private round before an initial public offering, though Mansour would say only that "there's been discussions."

What could go wrong? Dozens of state attorneys general argue Kalshi's sports contracts amount to illegal gambling and should fall under state law. Kalshi maintains it operates as a federally regulated exchange under the Commodity Futures Trading Commission; appeals courts have split, and New Jersey has petitioned the Supreme Court on whether federal law pre-empts state rules.

Mansour frames the fight as routine, citing the decades-long debate over grain futures. Investors "invested in a company that does everything by the rule," he said, adding that regulatory risk is "embedded into the valuation."

The signal: At $1 billion, this ranks among the largest US fintech raises on record — above the 95th percentile for the sector. The sharp repricing is a striking vote of confidence in Kalshi's growth, not proof that the business model's legal footing — or its path to an IPO — is settled.

Read more: The New York Times

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