Kalshi's valuation went from $22 billion to $40 billion, and now it's reportedly discussing $65 billion—nearly tripling in six months. I don't think this means “prediction markets are crushing it”; it looks more like annualizing peak-season numbers and pushing them as high as possible to raise another round before public markets scrutinize the company in an IPO.
First, the numbers Bloomberg reported on November 12: at the end of October, Kalshi had just closed a $1 billion round at a $40 billion valuation, led by Sequoia and Wellington. That round was originally seen as its last before going public. A few weeks later, it was discussing a $65 billion valuation. Its annualized revenue run rate had just topped $5 billion, gross margin was about 90%, and monthly notional trading volume rose from around $40 billion in August to nearly $100 billion in October.
$65 billion divided by $5 billion is 13 times run rate. Bloomberg previously reported that Polymarket's last round valued it at about $21 billion, with annualized revenue of around $1.8 billion—that's 11 to 12 times. So Kalshi's multiple itself isn't outrageously high. The problem is the denominator.
A run rate takes revenue from a recent period and multiplies it out over a full year. What kind of month was October? The NFL, the MLB playoffs, and then the betting surge ahead of the November 3 midterm elections—all at once. Annualizing a month like that is a bit like valuing a sportsbook based on its revenue during the World Cup. Here's my rough calculation: if the $5 billion figure is based on October multiplied by 12, that's about $420 million in monthly revenue against $100 billion in notional volume, a take rate just over 0.4%. That's my own estimate; Bloomberg didn't specify its methodology. After the election and the playoffs are over, whether notional volume can hold at $100 billion is what this $65 billion round is really betting on.
The second overlooked variable is sports. The bulk of Kalshi's volume comes from sports, and Louisiana just sued it along with more than twenty other platforms in state court. My view is that the real issue is the state's 21.5% online sports tax and licensing—not morality. The federal CFTC shield hasn't yet produced a consistent ruling across the circuit courts. If a few major states manage to rein in sports volume, that 13x won't stay 13x.
One other detail says a lot: they said it was the last round, then opened another one a few weeks later. If private investors are willing to pay a higher price—and you don't have to disclose quarterly results—who wouldn't want to raise one more round? The real test is who shows up to buy on IPO day.
Next, people will probably use this $65 billion valuation as a benchmark for small on-chain prediction market projects. Most of those platforms can't even agree on how to measure revenue, so don't get swept up in the hype.
#预测市场 #Kalshi
First, the numbers Bloomberg reported on November 12: at the end of October, Kalshi had just closed a $1 billion round at a $40 billion valuation, led by Sequoia and Wellington. That round was originally seen as its last before going public. A few weeks later, it was discussing a $65 billion valuation. Its annualized revenue run rate had just topped $5 billion, gross margin was about 90%, and monthly notional trading volume rose from around $40 billion in August to nearly $100 billion in October.
$65 billion divided by $5 billion is 13 times run rate. Bloomberg previously reported that Polymarket's last round valued it at about $21 billion, with annualized revenue of around $1.8 billion—that's 11 to 12 times. So Kalshi's multiple itself isn't outrageously high. The problem is the denominator.
A run rate takes revenue from a recent period and multiplies it out over a full year. What kind of month was October? The NFL, the MLB playoffs, and then the betting surge ahead of the November 3 midterm elections—all at once. Annualizing a month like that is a bit like valuing a sportsbook based on its revenue during the World Cup. Here's my rough calculation: if the $5 billion figure is based on October multiplied by 12, that's about $420 million in monthly revenue against $100 billion in notional volume, a take rate just over 0.4%. That's my own estimate; Bloomberg didn't specify its methodology. After the election and the playoffs are over, whether notional volume can hold at $100 billion is what this $65 billion round is really betting on.
The second overlooked variable is sports. The bulk of Kalshi's volume comes from sports, and Louisiana just sued it along with more than twenty other platforms in state court. My view is that the real issue is the state's 21.5% online sports tax and licensing—not morality. The federal CFTC shield hasn't yet produced a consistent ruling across the circuit courts. If a few major states manage to rein in sports volume, that 13x won't stay 13x.
One other detail says a lot: they said it was the last round, then opened another one a few weeks later. If private investors are willing to pay a higher price—and you don't have to disclose quarterly results—who wouldn't want to raise one more round? The real test is who shows up to buy on IPO day.
Next, people will probably use this $65 billion valuation as a benchmark for small on-chain prediction market projects. Most of those platforms can't even agree on how to measure revenue, so don't get swept up in the hype.
#预测市场 #Kalshi