Rivalry With Polymarket Is Driving Kalshi's Rapid Expansion
Kalshi's escalating competition with Polymarket has become a defining force in the prediction-market sector, according to CEO Tarek Mansour. In a newly released episode of the 20VC podcast, Mansour said the rivalry has pushed his company to outperform its own expectations, framing the dynamic as an essential component of building a lasting industry.
Mansour likened the relationship to well-known sporting matchups, pointing to NFL quarterbacks Tom Brady and Eli Manning as an example of competitors whose clashes ultimately elevated each other's performance. He said Brady later reflected on becoming “grateful” for the rivalry because the pressure created conditions for greater achievements.
Mansour said the same pattern was emerging in prediction market apps, where Kalshi and Polymarket have grown into two of the sector's most visible platforms. Founded in 2018, Kalshi enables users to trade on outcomes tied to elections, sports, and economic data.
The market has expanded significantly since Kalshi won a key regulatory case last year, opening the door to a broader range of event-based trading. Users have since been able to wager on questions covering consumer trends and the wealth of public figures.
Mansour acknowledged that not all competitive tactics were constructive, referencing a past incident in which staff amplified memes targeting Polymarket's chief executive. He described the move as a mistake and said he instructed employees not to repeat it.
He also compared the rivalry to the simultaneous rise of soccer players Lionel Messi and Cristiano Ronaldo, arguing that competition encouraged both companies to accelerate innovation and ultimately benefited customers.
Kalshi's funding round strengthens its position
Kalshi's latest funding announcement came amid an increasingly competitive backdrop in the prediction-market sector. Earlier this month, it confirmed it had closed a $1 billion Series E funding round, valuing the firm at $11 billion.
Paradigm led the round, with additional backing from investing firms Anthos Capital, Andreessen Horowitz, ARK Invest, CapitalG, IVP, Meritech Capital, Sequoia, and Y Combinator.
"Kalshi is replacing debate, subjectivity, and talk with markets, accuracy, and truth," said Mansour in a press release. “We have created a new way of consuming and engaging with information. It’s hard to have an opinion about the future today without thinking about Kalshi.”
The new valuation comes as Klashi ends its third quarter with $4.47 billion in trading volume, surpassing rival Polymarket, which recorded only $3.5 billion. On top of that, the prediction market platform aims to establish more partnerships with news sources, such as CNN, and data vendors to enhance the marketplace's accessibility and improve the flow of market information.
"Kalshi's exponential growth shows the scale of latent demand for prediction markets as a new asset class—from institutions to everyday people,” added Matt Huang, co-founder and managing partner at Paradigm. "People come for one type of market and stay for the breadth. We see this as an uncapped cultural and economic phenomenon, similar to how we felt about crypto a decade ago.”
