Kalshi Finalising $1 Billion Raise at $40 Billion Valuation Ahead of IPO
Bloomberg reported on September 30 that Kalshi is finalising a new $1 billion funding round at a ~$40 billion valuation — the company's last planned private round before an IPO expected as early as 2027. Sequoia Capital and Wellington Management lead; Tiger Global and Dragoneer also participating. Kalshi was valued at $11 billion in December 2025 and $22 billion in March 2026 — a near four-fold increase in under a year. Polymarket closed a $1 billion round in September at a $15-20 billion valuation.
Kalshi is finalising a new $1 billion funding round at approximately $40 billion valuation, Bloomberg reported on September 30, 2026. The round is led by Sequoia Capital and Wellington Management, with Tiger Global Management and Dragoneer Investment Group among additional participants. It is expected to be the last private round before an IPO, potentially in 2027. The valuation journey: $11 billion (December 2025) → $22 billion (March 2026) → $40 billion (September 2026). That near four-fold increase in under a year tracks the explosion in prediction market trading volume — from under $10 billion combined monthly in late 2025 to over $50 billion by July 2026.
For UK readers, the round structure resembles a pre-IPO secondary offering at a company like Monzo or Klarna before their public listings — a large late-stage round that brings in institutional public-market investors (Wellington Management is a public equities fund manager, not typically a venture investor) alongside existing venture backers. Wellington's participation signals that the perception of Kalshi has shifted from a binary regulatory bet to a pre-IPO growth asset: institutional asset managers who will hold the stock post-IPO are taking positions now at a discount to where they expect the IPO to price. The $40 billion valuation implies that the legal risk — active enforcement in ten-plus states, two adverse circuit court rulings — is either being discounted as resolvable or priced into the valuation relative to where a fully resolved legal status would trade.
The IPO timing is explicitly linked to the regulatory outlook. Bloomberg described the round as Kalshi's last before 'an initial public offering anticipated as soon as next year' — 2027. The most likely 2027 path runs through a SCOTUS ruling: the New Jersey and Robinhood cert petitions are pending; if the Court grants cert in October or November 2026 and schedules oral arguments for early 2027, a decision could come by June 2027. A favourable ruling — holding that the CEA pre-empts state gambling laws — would allow Kalshi to approach an IPO with national legal clarity. An adverse ruling would complicate the IPO story significantly, requiring investors to evaluate a public company whose primary revenue-generating contract category (sports) faces ongoing state enforcement in potentially all fifty states. The IPO valuation is not just a bet on growth; it is a bet on legal outcome.
Polymarket's concurrent fundraising activity provides the comparison. Polymarket closed a $1 billion round in September 2026 at a valuation in the $15-20 billion range, led by 1789 Capital. That valuation is roughly half of Kalshi's new $40 billion figure — a gap that has widened sharply from the closer valuation parity of 2025. The divergence reflects market share: Kalshi now commands 80-92% of combined US prediction market trading volume depending on the week and category. Polymarket US, constrained by the terms of its 2022 CFTC settlement to a narrower contract scope, has been unable to match Kalshi's sports contract growth. Polymarket International, with its new perpetual futures product, is pursuing a different strategy; but international volume does not feed directly into the US regulatory story that drives Kalshi's valuation premium. Both companies are heading toward public markets; Kalshi appears to be heading there first and at a higher relative valuation.
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Recent updates
Czech Republic Blocks Kalshi From October 15 — Polymarket Already Blocked Since July
The Czech Ministry of Finance listed Kalshi as an unauthorised gambling operator on September 30, requiring ISPs to block it by October 15. Polymarket was similarly blocked in July 2026. Both major US prediction market platforms are now blocked or under active enforcement in at least six European jurisdictions: Czech Republic, Belgium, France, Romania, Spain, and Germany. European regulators treat prediction market sports contracts as gambling regardless of CFTC regulatory status.
SCOTUS Publishes First Orders List — No Prediction Market Cases Granted Yet
The Supreme Court published its first orders list of the new term on October 2 — three cases granted, no prediction market cases. The absence was expected: Kalshi's response briefs to the New Jersey and Robinhood petitions are still pending. The Court typically conferences petitions a few weeks after all responses are in. Legal observers expect a prediction market cert decision in late October or November 2026.
Sixth Circuit Joins Ninth Against Kalshi — Ohio and Tennessee Can Regulate Sports Contracts
The Sixth Circuit ruled unanimously on September 25 that Ohio and Tennessee can apply their gambling laws to Kalshi's sports event contracts — the second circuit loss for Kalshi in a month. The panel held the contracts are not 'swaps' under the CEA, and alternatively that the CEA doesn't preempt state gambling law even if they are. The circuit split is now 2-1 against Kalshi (Third Circuit for; Sixth and Ninth against), sharply increasing the pressure on the Supreme Court to take the case.