Prediction markets are now mature enough to attract specialized venture capital, and investment firm 5c(c) Capital’s launch signals that investors are no longer just backing the exchanges themselves.
According to an investment document viewed by Bloomberg News, the new firm is launching with support from a broad roster of prominent investors, including Polymarket founder Shayne Coplan and Kalshi chief executive Tarek Mansour.
The fund is named after Section 5c(c) of the Commodity Exchange Act, tying its identity directly to the regulatory architecture governing event contracts.
The firm plans to raise up to $35 million and build a portfolio of about 20 companies over the next two years, according to the pitch materials.
The founders are Adhi Rajaprabhakaran and Noah Zingler-Sternig, both former Kalshi operators. Rajaprabhakaran was the second trader to join Kalshi Trading, the exchange’s market-making arm, and is also known for authoring the 50 Cent Dollars blog on prediction market infrastructure and business. Zingler-Sternig previously served as Kalshi’s head of operations and led the exchange’s integration with Robinhood Markets Inc.
The backer list is unusually dense for a first-time specialist fund. Bloomberg reported that more than 20 investors have offered early support, including a portfolio manager at Millennium Management, several crypto-focused venture firms, and founders of other prediction market companies including PredictIt. Marc Andreessen invested through Moneta Luna, alongside Andreessen Horowitz leaders Elena Silenok and Chris Dixon. Other confirmed limited partners include Underdog Fantasy chief executive Jeremy Levine and Novig chief executive Jacob Fortinsky.
Mansour’s and Coplan’s participations are strategically notable because Kalshi and Polymarket have been among the sector’s most visible rivals.
Sports have been the most popular prediction market trading category over the past year, but the founders argue that current activity understates the long-term addressable market. In the pitch document, they wrote that prediction markets “might appear to be just about sports,” but called that only the latest phase of a much larger story.
The document projects the industry could eventually reach $10 trillion in trading volume over time.
That bullishness arrives while the sector remains in regulatory conflict. State gaming regulators have argued in court that some of these products amount to unlicensed sports betting, while the platforms themselves are federally overseen as event-contract markets by the CCFTC. The current CFTC leadership has taken a more supportive posture.
Recently appointed CFTC Chairman Michael Selig in a February statement explicitly described the CFTC as “the legitimate regulator” of prediction markets while criticizing state encroachment.
Information for this story was found via Bloomberg and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
