Two early Kalshi alumni are raising up to $35M for 5c(c) Capital, a fund backed by Kalshi and Polymarket CEOs to invest in market makers, indices and tooling for prediction markets.

Former employees of regulated prediction market venue Kalshi are raising up to $35 million for a new venture fund aimed squarely at the fast‑maturing prediction market ecosystem, according to a filing and people familiar with the effort. The vehicle, called 5c(c) Capital, is being led by two early Kalshi team members and plans to back roughly 20 startups over the next two years, with a focus on market makers, index design, and core infrastructure for event‑driven trading. It arrives as on‑chain and regulated prediction platforms such as Kalshi and Polymarket see sustained double‑digit‑billion monthly volumes and intensifying institutional interest.

The fund has already secured backing from Kalshi CEO Tarek Mansour and Polymarket CEO Shayne Coplan, alongside investors linked to Andreessen Horowitz, Ribbit Capital, and Multicoin Capital, ChainCatcher reported. That cross‑platform support is striking given the public rivalry between the two founders, with Coplan previously dismissing Kalshi as “a Polymarket copycat” in media appearances as both firms compete for liquidity, listings, and regulatory terrain. “What we’re seeing now is investors underwriting the rails and tools that make these markets possible, not just the flagship venues,” said one person involved in the raise, who was not authorized to speak publicly.

The timing underscores how prediction markets have shifted from a speculative niche to a recognized piece of financial market plumbing. In February, Kalshi processed about $9.8 billion in trading volume, ahead of Polymarket’s roughly $7.6 billion, with the wider sector reaching $23.4 billion in activity, according to recent industry research. On both venues, ultra‑short‑term “up or down in five minutes” contracts on major crypto assets now drive a majority of crypto‑linked trading flows, blurring the line between hedging and high‑frequency gambling.

That growth has attracted heavyweight venture capital and large, liquidity‑provisioning firms looking for new ways to price political risk, macro data, and digital asset volatility. By concentrating on market‑making, indices, and tooling rather than consumer‑facing platforms, 5c(c) Capital is effectively betting that prediction markets will resemble an exchange stack: a handful of front‑ends sitting atop a deepening layer of specialized infrastructure. If the fund reaches its full $35 million target and deploys into 20 companies, average check sizes would sit in the mid‑single‑digit millions, enough to anchor seed rounds for the next generation of teams building liquidity engines, risk systems, and structured products for event‑driven trading.

According to crypto.news’ analysis of five‑minute crypto contracts on Polymarket and Kalshi, its breakdown of February’s $23.4 billion prediction volume, and ongoing coverage of venture capital flowing into event‑driven trading platforms.