In a somewhat surprising twist amid fierce industry competition, the leaders of two top prediction market platforms have pooled resources to back a specialized venture capital fund. Kalshi CEO Tarek Mansour and Polymarket CEO Shayne Coplan are key investors in 5c(c) Capital, a new firm raising up to $35 million to support early-stage companies building tools and services for the rapidly expanding prediction markets industry.
The fund, spearheaded by two former Kalshi staff members—Adhi Rajaprabhakaran, previously involved in market-making operations, and Noah Zingler-Sternig, a one-time head of operations—takes its name from a specific provision in the Commodity Exchange Act.
This clause underpins federal oversight of event contracts, the core mechanism behind prediction trading.
Over the next two years, the vehicle plans to deploy capital into roughly 20 startups, with a sharp focus on foundational infrastructure, including advanced market-making systems, custom indices for event outcomes, and other backend technologies essential for scaling these platforms.
Prediction markets enable users to trade contracts tied to real-world events, from election results to sports scores and economic indicators, effectively turning collective foresight into tradable assets.
The sector has seen explosive growth in recent years, drawing billions in trading volume and attracting mainstream attention.
Yet Kalshi and Polymarket have long been locked in a high-stakes battle for dominance, each offering regulated access to U.S. users while navigating complex legal terrain.
Their joint investment in 5c(c) Capital underscores a shared belief that strengthening the ecosystem benefits everyone, even direct competitors.
The fund has also drawn support from heavyweight venture investors, including Marc Andreessen, Ribbit Capital’s Micky Malka, and Kyle Samani, formerly of Multicoin Capital.
This collaborative spirit mirrors a broader trend across the financial technology landscape. Major platforms have aggressively entered the space to capture retail interest and diversify beyond traditional offerings.
Robinhood, for example, partnered early with Kalshi to roll out a dedicated prediction markets hub, later adding sports contracts that fueled significant revenue gains and helped drive its stock performance.
Coinbase has similarly expanded, launching event-based trading features and exploring USDC settlements in collaboration with established players as part of its push to become a full-service exchange.
Gemini introduced its own “Gemini Predictions” product in late 2025, initially centered on sports events, positioning itself as a nimble competitor.
Other crypto exchanges, such as Kraken, have signaled similar ambitions, integrating or planning event contracts to tap into the same demand.
Analysts view these moves as evidence of prediction markets maturing from niche experimentation into a core financial product.
By investing in specialized infrastructure, 5c(c) Capital aims to address liquidity challenges, improve settlement efficiency, and foster innovation that could sustain the sector’s momentum.
With regulatory scrutiny intensifying and trading volumes hitting record highs, the fund’s launch signals robust confidence in prediction markets as a “generational opportunity.”
Industry professionals will now aim to monitor how these investments translate into new tools that enhance accessibility and reliability for everyday users. Ultimately, this alignment between rivals could accelerate the mainstream adoption of a technology once dismissed as fringe betting.