According to insiders, the US-based prediction market platform Kalshi saw its annualized revenue exceed $4 billion in July, driven by World Cup-related wagering. This marks a doubling from the roughly $2 billion annualized figure recorded just two months earlier.
The revenue surge is expected to significantly boost the valuation of the prediction platform's upcoming funding round. Kalshi is currently in deep negotiations for a new financing round, targeting a post-money valuation of $40 billion. This is nearly double the valuation from its previous funding round announced in May. However, a potential hurdle exists, as Kalshi has incurred massive marketing expenses to attract bettors and may face new tax costs in its core markets.
Insiders noted that Kalshi's operating expenses for June reached $300 million, primarily driven by marketing spending. If this spending pace continues, its annualized operating costs could reach $3.6 billion. The marketing campaign includes advertisements featuring Timothée Chalamet and Lionel Messi, as well as a sponsorship deal with FIFA for the 2026 World Cup, covering stadium, television, and online advertising.
Previous reports indicated that Kalshi is exploring a new funding round with a target valuation of $40 billion, potentially closing as early as the third quarter. A Kalshi spokesperson declined to comment on the matter. If this funding round materializes, Kalshi's private market valuation would surpass the market capitalization of cryptocurrency exchange Coinbase.
It is understood that, fueled by rapid growth from sports betting, Kalshi has held informal discussions with investment banks and is planning to launch an initial public offering (IPO) as early as next year. Kalshi's primary revenue source is transaction fees. As event contracts become increasingly popular, platforms like Robinhood and DraftKings have entered the market, creating competition where marketing is expected to remain a key battleground.
Meanwhile, the booming sports betting segment of the prediction market has drawn opposition from traditional gambling platforms and state gambling regulators. Kalshi is currently embroiled in multiple legal disputes with regulatory bodies in various states, which accuse the platform of engaging in illegal gambling activities. Sports-related contracts account for over 80% of the platform's total trading volume.