Prediction market giant Kalshi has raised a fresh $1 billion in a funding round that values the company at $40 billion — as the company’s co-founders fessed to dating back in the day.
The massive deal that comes amid mounting legal and regulatory hurdles that threaten to upend the fast-growing company.
Kalshi said Thursday its business of offering wagers across a slew of real-world events — from sports and the Oscars to the weather — has continued to expand since its previous financing in May. Back then, it was valued at $22 billion.
The latest deal was co-led by top Silicon Valley venture firm Sequoia Capital and investment firm Wellington Management. It brings Kalshi’s total amount raised to roughly $3.6 billion.
The New York-based company attributed its recent growth to increased trading on events including this year’s FIFA World Cup, NFL games and election-related markets ahead of the US midterms.
At the same time, Kalshi – led by CEO Tarek Mansour and his No. 2 exec Luana Lopes Lara – faces a landslide of legal complaints, particularly over its sports wagers.
They admitted they used to date in an interview with Bloomberg published this week.
Asked about the matter, Lara said it was “a long time ago.”
“The company always comes first for us, essentially” Mansour said.
“By the time we started the company, it was basically already fizzled out and, um, company above all else,” he added. “And, you know, it’s worked out for us.”
Shayne Coplan, the CEO of prime Kalshi rival Polymarket, repeatedly circulated the rumor that Mansour and Lopes Lara used to date, as first reported by The Post.
Since August, two US appeals courts have ruled that states have the power to regulate sports-related event contracts – significant setbacks for Kalshi’s arguments that the federal government should continue to have oversight of prediction markets.
Sports betting is key for Kalshi, accounting for as much as 70% of an estimated $4 billion in revenue during the 12 months ended this July, according to a source close to the company.
Just this week, Utah’s attorney general brought criminal charges against Kalshi and Mansour and Lopes Lara, alleging the platform illegally promotes online betting in the state that has outlawed gambling. The charges also accuse Kalshi of allowing an undercover agent to place wagers on sports events.
The allegations came a day after the Commodity Futures Trading Commission sued to block the state from enforcing its anti-gambling laws against Kalshi.
Venture capitalists have told The Post that the Trump administration’s support of prediction markets could mean that by the time a new administration comes in, Kalshi may be so integrated into financial markets – and everyday life for many Americans – that unwinding it would be deeply unpopular.
That hasn’t stopped states from going after Kalshi. Earlier this month, Utah’s Attorney General Derek Brown alleged in state court that Kalshi is “the manager of a back-alley gambling den,” saying the company has shown a “brazen pattern of unlawful conduct.”
Other states including New York and Nevada have sought to prevent Kalshi from offering wagers in their jurisdictions.
Kalshi has thus far received a light regulatory touch from the Trump administration’s CFTC, which oversees prediction markets. Presidential scion Donald Trump Jr. joined Kalshi as a strategic advisor last year and is an equity holder in the company.
Kalshi claims its event contracts – which allow users to take a “yes” or “no” position – are financial “swaps” rather than gambling and thus should be regulated by the CFTC.
Kalshi also faces a trio of lawsuits brought by Native American tribes alleging Kalshi and other prediction markets of violating their tribal sovereignty by offering sports betting on reservations.
Last month, the Ninth Circuit of the US Court of Appeals ruled against Kalshi in one tribal suit, setting the stage for a showdown in the Supreme Court that risks crippling the app’s exploding business.
Mansour has indicated he’s willing to take the jurisdiction disputes to the Supreme Court to settle the matter.
