Ex-Kalshi Team Launches $35M Fund to Revolutionize Prediction Market Infrastructure!

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Ex‑Kalshi staff launch $35M fund for prediction market infrastructure

Two former employees of Kalshi are launching 5c(c) Capital, a new fund aiming to raise up to $35 million. The fund has support from the CEOs of both Kalshi and Polymarket and will focus on investing in companies that build tools and operate within the prediction market space, including those creating market-making services and new indices.

Summary

  • Former Kalshi staffers are raising up to $35 million to back prediction market infrastructure startups.​
  • The new fund, 5c(c) Capital, has support from Kalshi CEO Tarek Mansour, Polymarket CEO Shayne Coplan, and top venture firms.​
  • The vehicle plans to make around 20 investments over two years across market makers, indices, and tooling for event‑based markets.

A new venture fund, 5c(c) Capital, is being launched by former employees of the prediction market platform Kalshi. They’re aiming to raise up to $35 million to invest in around 20 startups over the next two years. The fund will focus on companies building essential components for the growing prediction market, including those involved in trading, creating market indexes, and developing underlying infrastructure. This comes as platforms like Kalshi and Polymarket are experiencing significant growth in trading volume and attracting more interest from institutional investors.

The fund has received investment from Tarek Mansour, CEO of Kalshi, and Shayne Coplan, CEO of Polymarket, as well as investors with ties to Andreessen Horowitz, Ribbit Capital, and Multicoin Capital, according to ChainCatcher. This support is notable considering the public competition between Coplan and Mansour – Coplan previously called Kalshi a copycat of Polymarket in public statements, as both companies vie for market share and favorable regulations. One source involved in the funding round, who wished to remain anonymous, explained that investors are now focusing on the underlying infrastructure and tools that enable these markets, rather than just the main platforms themselves.

A sector moving from niche to infrastructure

The recent growth in trading volume highlights how prediction markets are becoming a mainstream part of the financial system. In February, Kalshi saw about $9.8 billion in trades, surpassing Polymarket’s $7.6 billion. The entire sector reached $23.4 billion in activity, according to new research. A large portion of crypto trading on these platforms now involves very short-term contracts – bets on whether prices will go up or down in just five minutes – which makes it hard to distinguish between legitimate risk management and fast-paced gambling.

The increasing popularity of prediction markets has drawn significant investment from venture capital firms and companies specializing in market liquidity, all seeking new methods to assess political and economic risks, as well as the fluctuating values of digital assets. 5c(c) Capital is focusing on the underlying technology – market-making systems, indices, and development tools – rather than directly appealing to consumers. This strategy is a bet that prediction markets will evolve like a traditional financial exchange, with various user interfaces built on top of a robust and specialized infrastructure. If the fund reaches its goal of $35 million and invests in 20 companies, it would provide seed funding in the millions of dollars for startups developing the core technologies – liquidity engines, risk management systems, and structured products – needed for trading based on current events.

Based on our analysis of short-term crypto predictions on Polymarket and Kalshi, a review of $23.4 billion in February trading volume, and our reporting on investment in event-based trading, crypto.news has observed…

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2026-03-23 23:59