Why this matters: a betting-adjacent startup is about to be worth $40 billion — nearly double its price from four months ago — and Wall Street's biggest names are lining up to pay it.
October 1, 2026 — Prediction-market exchange Kalshi is in advanced talks to raise close to $1 billion in new funding at a valuation of roughly $40 billion, according to Reuters and Bloomberg reporting this week. The deal, which sources say could close in the coming weeks, would nearly double Kalshi's price tag just four months after its last round — and position it for a possible public listing as soon as next year.
Image: illustration of a glowing stock chart arrow climbing over a futuristic trading floor with floating contract tickets and gold coins. Credit: Red Eye Eagle News / original AI illustration.
Editor's Highlight: Kalshi has gone from a $5 billion valuation to a reported $40 billion in under a year — an eightfold jump that says less about prediction markets as a product and more about how desperately capital wants a regulated piece of them.
Table of Contents
- Key Facts
- The Reported Deal
- An Eightfold Climb in Under a Year
- Why Investors Are Paying Up
- The Three-Way Capital Race
- The Regulatory Shadow
- Bottom Line
- FAQ
- Sources
Key Facts
| Detail | Information |
|---|---|
| Round | ~$1 billion raise in advanced talks, reported September 29, 2026 |
| Valuation | Roughly $40 billion — up ~82% from $22 billion in May |
| Reported leads | Sequoia Capital and Wellington Management in talks to lead |
| Other investors | Tiger Global and Dragoneer reportedly circling |
| Last round | $1 billion Series F at $22 billion, led by Coatue, May 2026 |
| Business | CFTC-registered U.S. prediction-market exchange |
| Next step | Possible IPO as soon as next year, per reports; company has not confirmed |
The Reported Deal
Reuters broke the story on September 29, citing people familiar with the confidential negotiations: Kalshi is in advanced talks to raise about $1 billion from existing and new investors. Sequoia Capital — already a backer, with partner Alfred Lin holding one of Kalshi's five board seats — and Wellington Management are reportedly discussing leading the round, with Tiger Global Management and Dragoneer Investment Group also in the mix.
Bloomberg separately reported the company is in final negotiations for what could be its last private round before a public debut. Kalshi has not announced the round, and all figures remain subject to change. When contacted by Reuters, Kalshi and Tiger Global declined to comment; Sequoia, Wellington, and Dragoneer did not respond.
Sources told Reuters the transaction is expected to be finalized in the coming weeks — though the specific terms could still be modified before any agreement is signed.
An Eightfold Climb in Under a Year
The speed of Kalshi's appreciation is the story. Its valuation history reads like a launch sequence:
| Date | Event |
|---|---|
| October 2025 | $300 million raise at $5 billion valuation |
| December 2025 | $1 billion raise at $11 billion valuation |
| May 2026 | $1 billion Series F at $22 billion, led by Coatue |
| September 2026 | ~$1 billion in talks at ~$40 billion (reported) |
That is roughly a 700% increase from last October's figure, in under twelve months. The $22 billion mark itself had doubled from $11 billion just months earlier.
Why Investors Are Paying Up
The numbers behind the price tag, as reported, are formidable. Bloomberg reported Kalshi's August trading volume surpassed $40 billion, based on user-compiled data on Dune Analytics, with annualized revenue of about $4 billion as of August and gross margins around 90%, according to documentation the outlet viewed.
Research firm Sacra estimates the company hit $3.5 billion in annualized revenue in June — implying an 11x revenue multiple at the proposed $40 billion valuation. At the May round, Kalshi disclosed that institutional trading activity had surged 800% over the prior six months, and its annualized trading volume had climbed from $52 billion to $178 billion.
Newsroom Focus: An 11x revenue multiple is venture capital pricing Kalshi as infrastructure — a future CME Group — not as an app. The bet is that event contracts become a permanent, regulated asset class. If they remain a niche, the multiple has nowhere to go but down.
Kalshi's edge, in investors' eyes, is regulatory: it operates as a CFTC-registered exchange, which has attracted serious capital even as the company sits in the gray zone where financial markets and gambling blur. Kalshi is also broadening beyond prediction markets into a multi-asset trading platform, aiming to compete with CME Group and Intercontinental Exchange — though sports contracts still account for roughly 80% of its trading volume, per analyst estimates.
The Three-Way Capital Race
Kalshi is not raising in a vacuum. Rival Polymarket is separately pursuing roughly $1 billion of its own, according to people familiar with its fundraising discussions, even as it faces delays around its U.S. product and a CFTC investigation.
The competitive pressure cuts both ways. Robinhood routes high-volume World Cup contracts to its own proprietary exchange rather than through Kalshi. Upstart Novig — valued at about $2 billion — is also in the hunt, and Meta is reportedly developing a competing product.
Analysis Note: Sequoia and Wellington co-leading signals that top-tier firms now treat CFTC-registered event contracts as a winner-take-most category. Every venture dollar flowing to Kalshi at this price is a dollar unavailable to Polymarket or Novig — the round is as much a competitive weapon as a financing.
The Regulatory Shadow
The biggest risk to the $40 billion thesis is not competition — it is lawmakers. Reuters reported earlier in September that legislators, including U.S. Senator Adam Schiff, are questioning investor protection and market oversight as these contracts spread. State regulators have filed lawsuits challenging the legality of sports contracts on the platform, and the company faces an ongoing insider-trading probe by the House Oversight Committee, plus scrutiny over wash-trading claims.
Kalshi has had courtroom wins — a federal judge permanently blocked Arizona from prosecuting the company over alleged state gambling-law violations — but the legal front is state-by-state and far from settled. The war chest from this round would fund exactly that fight, alongside margin-trading expansion.
Practical Takeaway: Treat the $40 billion as a reported negotiation, not a done deal. Nothing is signed, Kalshi has confirmed nothing publicly, and the regulatory overhang is the variable that could reprice everything.
Bottom Line
Kalshi's reported $40 billion round would cap one of the fastest valuation climbs in startup history — and fire the starting gun on prediction markets' endgame: regulated, multi-asset exchanges competing with the CME. Watch whether the round closes on these terms, and whether lawmakers move faster than the bankers.
FAQ
What is Kalshi?
A U.S. prediction-market exchange regulated by the Commodity Futures Trading Commission. Users trade contracts tied to the outcome of future events — elections, economic data, sports — where the contract price reflects the crowd's view of how likely the event is.
How much is Kalshi reportedly raising, and at what valuation?
About $1 billion at roughly a $40 billion valuation, in advanced talks reported September 29, 2026. Sequoia Capital and Wellington Management are reportedly discussing leading the round. Nothing has closed and Kalshi has not confirmed it.
How fast has Kalshi's valuation grown?
From $5 billion in October 2025 to a reported $40 billion now — about a 700% increase in under a year, via $11 billion in December 2025 and $22 billion in May 2026.
Who is competing with Kalshi?
Polymarket (separately seeking ~$1 billion), Novig (~$2 billion valuation), Robinhood's proprietary exchange, and reportedly Meta — plus the traditional exchanges Kalshi wants to challenge, CME Group and Intercontinental Exchange.
What are the regulatory risks?
State lawsuits over sports contracts, a House Oversight Committee insider-trading probe, lawmaker questions about investor protection, and wash-trading scrutiny — even though Kalshi is CFTC-registered and has won some court battles.
Sources
- https://predictionnews.com/story/kalshi-valuation-nearly-doubles-in-four-months — Prediction News, Sept 30, 2026: Bloomberg reporting on final negotiations, pre-IPO framing
- https://blockonomi.com/kalshi-eyes-massive-40-billion-valuation-in-new-funding-round/ — Blockonomi, Sept 30, 2026: Reuters Sept 29 scoop, investor lineup, May round details
- https://adbytes.media/blog/kalshi-nears-40-billion-valuation-as-ipo-talk-builds-around-prediction-markets — Adbytes Media, Sept 30, 2026: Bloomberg volume/revenue figures, IPO timing, 90% margins
- https://tradersunion.com/news/financial-news/show/3571259-kalshi-nears-1-billion-fundraise-valuation-prediction-markets/ — Traders Union, Sept 29, 2026: multi-asset pivot, CME rivalry, regulatory scrutiny
- https://zubiqo.com/news/kalshi-targets-40b-valuation-in-1b-funding-round-to-rival-cme-group-dvvvwr — Zubiqo Intelligence, Sept 30, 2026: Sacra revenue estimates, 80% sports volume, Oversight probe
- https://finimize.com/content/kalshi-eyes-a-40-billion-valuation-in-new-funding-round — Finimize, Sept 29, 2026: Polymarket parallel raise, Schiff lawmaker scrutiny
- Original AI illustration created for this article — hero image above.
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