Why Sports Prediction Markets Are Exploding Right Now (Part 1)
Inside the boom of sports prediction markets and what it means for investors in the attention economy.
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Conversational AI Is Quietly Becoming the New Front Door to Fan Engagement
This week, the Milwaukee Bucks announced a partnership with GameOn Technologies to integrate conversational AI into their fan experience.
A small headline - but a massive signal.
Behind the scenes, AI is stepping into a role that used to belong to large support teams, complex CRM stacks, and legacy mobile apps. What conversational AI is unlocking for teams today is not just automation, but a new intelligence layer:
AI-powered conversations that handle ticketing, merch, and game-day logistics
Always-on, real-time fan engagement without human bottlenecks
Richer customer insights as fans interact across multiple touchpoints
Operational efficiency that lets staff focus on higher-value fan and partner relationships
And most importantly: a foundation for hyper-personalized fan journeys
Teams once treated digital engagement as a marketing add-on.
Now it’s infrastructure.
And as conversational AI matures, franchises will begin competing not on seating charts or stadium design, but on the intelligence, responsiveness, and personalization of the fan interface that sits between them and their community.
It’s also why, in the Middle East [Customers here already include MBC, Noon Academy, Keeta, Arab Therapy, Yalla Group amongst others], we actively represent Agora, whose Conversational AI Engine provides the real-time building blocks for this new engagement layer - in any language.
Why Agora? Because ultra-low latency, a NASDAQ-listed pedigree, and ~60% global market share in real-time audio and video is exactly what you need when every millisecond of fan interaction matters.
If the Bucks–GameOn deal is the spark, expect the rest of global sport - leagues, teams, federations, and even venues - to follow fast. Fan engagement is being rewritten in real time, one intelligent conversation at a time.
Today’s line-up
Betting on the Future: Sports Prediction Market Startups to Watch
And Action!
Betting on the Future: Sports Prediction Market Startups to Watch
Sports prediction markets – platforms where fans trade on game outcomes like stocks – are emerging as the next frontier in sports tech. Over the past year, prediction market volume has exploded by 580%, from about $50 million in August 2025 to $340 million in November 2025. Notably, sports now lead this activity: at Kalshi, a regulated U.S. exchange, sports contracts made up ~59% of volume in the past year – surging to ~90% as it doubles down on its CFTC-approved sports betting advantage. The sector has attracted significant capital, with $2.7 billion invested in prediction-market startups in 2025 alone (87% of all-time funding). Two companies – Polymarket and Kalshi – dominate 98% of total prediction market volume and together secured roughly $2.64B of 2025’s funding. This momentum is blurring lines between gambling and investing, drawing in major players like FanDuel (partnering with CME Group on “event contract” betting) and Fanatics (exploring a Crypto.com tie-up) to launch their own prediction products.
For early-stage investors like Pressplay Capital, which focuses on sports tech in the attention economy, this trend represents both a massive market opportunity and a shifting regulatory landscape. Below, we spotlight some of the most promising startups building sports-focused prediction market platforms – from real-money exchanges to fantasy and tokenized models – with an emphasis on the U.S. and MENA regions. Each offers a unique business model, growing traction, and a differentiated approach to monetizing sports fandom.
Polymarket – Decentralized Sports & Events Trading
Polymarket is a New York-founded startup that has become the world’s largest decentralized prediction market, allowing users to bet on all manner of future events using cryptocurrency. While not limited to sports, Polymarket sees a huge chunk of its activity in sports markets (about 35% of its volume, alongside 47% in politics). Users buy and sell outcome shares (yes/no contracts) on an open marketplace, with prices in stablecoins reflecting the probability of each outcome. Polymarket built its reputation on crypto-based, user-created markets, now hosting thousands of markets at any given time.
Business Model: Polymarket takes a small fee on trades and liquidity provision. It leverages blockchain (formerly on Polygon) to enable peer-to-peer trading without a traditional bookmaker. Markets span sports games, player performance, and even non-sports events, but sports have been a key growth driver. The platform operates in a regulatory gray area – it voluntarily geofenced U.S. users after a CFTC inquiry in 2022 – but remains accessible globally via crypto.
Traction & Fundraising: Polymarket’s volumes and valuation have skyrocketed in 2025 amid a prediction market boom. It reportedly facilitated hundreds of millions in trades and drew the attention of major financial institutions. In October 2025, NYSE parent ICE (Intercontinental Exchange) agreed to invest up to $2 billion in Polymarket – a massive bet that could pave the way for a regulated U.S. launch. According to one industry report, Polymarket raised about $2.15B in 2025 (the bulk of that ICE deal), making it one of the best-funded players in the space. Such backing suggests strong confidence in Polymarket’s model and its ability to scale.
Core Differentiation: Decentralization and breadth of markets. Polymarket’s crypto-native design lets it list an unparalleled variety of user-driven markets quickly (far beyond what a traditional sportsbook offers). This long-tail content, combined with a slick trading UI, positions Polymarket more as an information exchange than a gambling site. It has also been a pioneer in the space – one of the first to show how blockchain can enable low-friction trading on sports odds without traditional intermediaries. Its partnerships with firms like PrizePicks (a U.S. fantasy sports operator) hint at a hybrid future where Polymarket provides the market infrastructure behind mainstream apps.
Revenue Potential: If Polymarket becomes a fully regulated platform in major markets (e.g. via the ICE partnership), its revenue could rival that of mid-sized sportsbooks. It earns money via trading fees (akin to an exchange commission) rather than a “vig” on lost bets. This model could scale tremendously with volume – think of collecting tolls on an information highway. With sports betting itself a $80B+ global market and prediction markets projected to reach $95B TAM by 2035, Polymarket’s slice could be substantial if it continues to lead on liquidity and market variety.
Pressplay Perspective: Polymarket represents a bold, somewhat high-risk/high-reward play in sports tech. For a fund like Pressplay, its appeal lies in how it merges fintech, crypto, and sports engagement. It’s essentially turning sports predictions into tradeable assets – a concept that, if regulators permit, could reshape fan interaction and betting economics. While Polymarket is now flush with later-stage capital (likely beyond seed fund scope), its trajectory validates the prediction market thesis. Pressplay can glean insights about user demand (e.g., fans love trading sports opinions like stocks) and be on the lookout for regional or niche adaptations of this model (perhaps a MENA-focused crypto sports exchange in a friendly jurisdiction).
Kalshi – Regulated Event Exchange Betting on Sports
Kalshi is the first CFTC-regulated prediction market exchange in the U.S., often touted as a “stock market for everyday events.” Based in New York, Kalshi operates fully within U.S. law as a Designated Contract Market, letting users trade yes/no contracts on everything from economic indicators to weather events – and now, sports outcomes. In late 2024, Kalshi won a landmark court battle against the CFTC, securing the right to offer political event markets. This cleared the path for what came next: sports event contracts, which Kalshi began rolling out in early 2025. By self-certifying sports contracts (e.g. “Yes/No: Team X wins the championship”), Kalshi effectively enabled real-money sports betting in states that haven’t legalized sportsbooks, by treating these bets as federally regulated futures contracts.
Business Model: Kalshi charges transaction fees on trades (like a mini futures exchange). Rather than a traditional sportsbook’s house odds, users buy outcome contracts priced $0 to $1 (reflecting probabilities 0–100%). If the outcome happens (yes), the contract pays $1; if not, $0 – traders can buy or sell at any time, pocketing gains or cutting losses. For example, a contract “Will Team A win?” might trade at $0.27 (27% chance); you could buy 10 contracts at $0.27 and profit $7.30 if it hits $1 on a win. Kalshi’s fee replaces the sportsbook “vig,” and market makers provide liquidity in exchange for small rebates. This model aims for efficient, low-margin trading rather than the hefty 5-10% hold of typical betting.
Traction & Fundraising: Kalshi has gained significant traction, especially after adding sports and partnering with mainstream platforms. It is available in 46 U.S. states (everywhere except a few gambling-heavy states). In March 2025, Robinhood integrated Kalshi’s markets into its app, exposing millions of users to event trading. The result: an “instant surge in volume” where sports quickly became the majority of Kalshi’s activity. Over the last 12 months, 59.3% of Kalshi’s volume came from sports, far exceeding politics or economics. Kalshi’s fundraising reflects its ambitions – it has raised an estimated $485M (as of 2025) from top VCs and angels, and its reported valuation is soaring into unicorn territory. This war chest has funded legal battles and user acquisition to carve out Kalshi’s first-mover advantage in regulated event betting.
Core Differentiation: Regulatory legitimacy and first-mover advantage. Unlike most startups in this space, Kalshi fought for and obtained a clear regulatory pathway – giving it a moat in the U.S. market. It can operate where sportsbooks can’t (at least until the likes of CME/FanDuel spin up competing venues). Kalshi’s brand is about trust and credibility: it’s positioning itself as the NYSE of prediction markets, complete with big-name market makers (Susquehanna, etc.) ensuring liquidity. Also, Kalshi’s product design appeals to a slightly different demo – people who think in probabilities and portfolios. In effect, it’s tapping an investor mindset (trade news and outcomes) plus the traditional sports bettor, expanding the addressable audience.
Revenue Potential: If Kalshi can withstand regulatory pushback from some U.S. states (several tried to shut down its sports markets in 2025, prompting Kalshi to sue them in federal court), it stands to capture a significant slice of the sports betting handle through fees. Its trading fees are lower-margin per bet than a sportsbook’s cut, but could aggregate huge volume. The example of election trading in Nov 2024 (where Kalshi saw $245M traded in a single day) shows the upside. Sports events happen constantly, suggesting even larger cumulative volume if Kalshi scales. Long-term, Kalshi could monetize data feeds, listing fees for new markets, or even B2B services powering others’ prediction apps – making it strategically akin to a mini-CME for sports.
Pressplay Perspective: Kalshi demonstrates how regulatory innovation can unlock a new market. For Pressplay, it’s a case study in navigating legal gray zones to deliver a novel sports betting experience. The strategic relevance is high: Kalshi’s success (or setbacks) will influence the viability of similar models in other regions. For example, could a MENA-based, regulator-sanctioned prediction exchange be possible? (Perhaps in a jurisdiction like Abu Dhabi’s ADGM or Dubai’s DIFC, if framed as a financial market product). Kalshi’s journey also highlights the power of partnerships (e.g. Robinhood) to accelerate user adoption. An early-stage fund might not access Kalshi now, but understanding its model helps in spotting the next startup applying this exchange approach to a new market or niche.
Novig – Peer-to-Peer “No Vig” Sports Betting
New York-based Novig is reimagining sports betting as a true peer-to-peer exchange, eliminating the bookmaker altogether. The name “No-vig” itself telegraphs the value prop: unlike traditional sportsbooks that bake in a ~5% edge (the vig), Novig lets users bet directly against each other with zero commission on odds. In place of the house, Novig runs a two-sided marketplace where bettors can post and accept wagers, much like traders placing bids and asks. By not taking risk on outcomes and instead facilitating matches, Novig aims to offer better payouts for winners and more transparency in an industry often marked by opaque odds and high marginsaxios.com.
Business Model: Novig’s sweepstakes-based model is designed to navigate U.S. gambling laws while providing real-money prizes. Users trade against friends or the broader market on the platform, with Novig essentially acting as an exchange operator rather than a bookie. How can it sustain “no vig”? Initially, Novig may monetize via membership fees, premium features, or sponsorships while running betting contests under sweepstakes regulations (similar to how some DFS sites operated early on). In the long run, once properly licensed, Novig could introduce tiny trading fees per bet matched – but pitched as far more bettor-friendly than the implicit cut on a normal sportsbook. The key is that prices are user-generated: if one user offers Team A at -110 and another takes it, no automatic house cut is taken. This market-driven pricing could yield sharper odds and higher returns to winners.
Traction & Fundraising: Novig’s vision has attracted serious investor interest. It went through Y Combinator (S22) and by August 2025 raised a $18 million Series A led by Forerunner Ventures, with participation from Y Combinator and notable angels. This followed a seed round in 2023 that included legendary quarterback Joe Montana’s fund. While still in beta, Novig has been fast-growing by positioning itself as “America’s #1 Sports Prediction Market” (a bold claim as a young startup). The team, led by CEO Jacob Fortinsky, includes quants and engineers who are avid sports bettors – even sharps who were banned by traditional books, channeling their frustration into building a more fair exchange. Currently, Novig is invite-only in certain states, often structured as free-to-play pools to build a user base. The fresh capital is aimed at securing licenses and expanding to more bettors in 2024-2025.
Core Differentiation: True peer-to-peer betting with no house edge. While betting exchanges exist (e.g. in Europe or newer U.S. entrants we discuss below), Novig is evangelizing the complete removal of vig and prioritizing user profit. This is a compelling pitch to sophisticated bettors who feel exploited by conventional books. Novig also emphasizes transparency – odds are set by supply and demand, not a mysterious algorithm behind the sportsbook. By enabling users to “be the bookie” if they want (setting their own odds), it creates engagement and potentially better pricing. Moreover, Novig’s slick interface and social features (betting against friends) nod to a modern, community-driven experience rather than the stale casino vibe. In short, Novig is trying to do in sports betting what a stock exchange does in equities – remove middlemen and let the market find a fair price.
Revenue Potential: If Novig succeeds, the revenue model might flip traditional betting economics on their head. Instead of winning by customers losing (as sportsbooks do), Novig would earn by volume. This could mean charging a tiny fee per matched bet or a subscription for unlimited betting, akin to a trading platform. The U.S. sports betting handle was about $93 billion in 2022 (legal bets) and growing; even a fraction flowing through an exchange could be enormous. For example, if Novig facilitated $1B in bets and took just a 1% fee, that’s $10M revenue – and 1% fee is still far better odds for users than a 5% vig. Novig’s challenge is reaching critical liquidity; however, if it does, the scalability is high (low incremental costs to add more volume). It could also generate ancillary revenue by selling betting data or offering premium analytic tools for serious traders. Strategically, an exchange like Novig could become an attractive acquisition target for larger sportsbooks looking to offer a zero-vig product (or to neutralize a threat).
Pressplay Perspective: Novig aligns perfectly with a venture thesis of using technology to disrupt an entrenched value chain. Pressplay Capital would appreciate how Novig attacks a pain point (high fees, lack of fairness) with a marketplace solution – a classic fintech disruption applied to sports. As an early-stage company with a recent Series A, Novig is in that sweet spot where execution will determine if it can grab a beachhead before big competitors react. Its success would validate peer-to-peer models in sports, which could spill over to other regions – e.g., perhaps a similar exchange could thrive in markets where bettors are currently underserved by legal sportsbooks (MENA comes to mind, if regulatory climates evolve). The strategic relevance is also in user engagement: a no-vig platform could entice a savvy, high-LTV segment of bettors (the kind who churn from regular books due to limits or mistrust). For Pressplay, keeping an eye on Novig’s growth and regulatory progress can inform bets on the broader sports betting ecosystem’s evolution.
Sporttrade – Trading Sports Bets Like Stocks
Philadelphia-based Sporttrade is a pioneer in bringing the ethos of financial trading to the sports betting world. Launched in 2022 in New Jersey, Sporttrade operates a licensed sports betting exchange that lets users trade in and out of bets in real-time, just as one would trade stocks or options. The startup’s app looks and feels like a brokerage platform: users see a marketplace of contracts for game outcomes, each with a price fluctuating based on live odds. Instead of placing a fixed bet “to win $X,” a user buys contracts on an outcome (say at $0.26 for a 26% chance) and can sell anytime – locking in profit or cutting loss based on how the odds move. In short, Sporttrade turns sports bets into liquid, tradeable assets.
Business Model: Sporttrade matches bettors peer-to-peer and makes money via a small commission on each trade (around 2%). By acting as an exchange, it avoids taking risk on outcomes and instead focuses on providing tight spreads and deep liquidity. Notably, Sporttrade partners with professional market makers (often high-frequency trading firms) that continuously offer odds, ensuring users can get in or out at fair prices. The platform emphasizes in-play betting – users can actively trade during games, for example buying low on a team when they’re behind and selling if the odds improve after a comeback. This dynamic trading is a departure from static pre-game bets and appeals to an audience that enjoys active trading or day-trading paradigms. Sporttrade currently charges no vig; the only cost to the user is the commission embedded in the price (similar to how stock trading fees work).
Traction & Fundraising: Sporttrade has made solid progress in a heavily regulated arena. It raised about $36–45 million from investors including Nasdaq Ventures, Jump Capital, and prominent quant firms like Susquehanna (SIG) and Tower Research – a lineup that underscores its “Wall Street meets sports” DNA. The app officially launched in New Jersey in late 2022 and has since expanded to at least three more states (e.g. Colorado in 2023, with Arizona and Iowa approvals by 2025). While still a niche player next to giants like FanDuel, Sporttrade differentiates by offering better odds (often -104 vs the standard -110) and instant execution without the delays or limits of traditional books. User uptake includes a mix of seasoned sports bettors and finance-savvy bettors; one indicator of interest is the community of users on forums (e.g., a Reddit “AMA” with the founder) praising the ability to “cash out” by selling to other traders rather than to the house. Sporttrade’s focus on user experience (real-time updates, modern UI) has earned it a reputation as a slick and transparent platform.
Core Differentiation: Financial-market style trading and superior pricing. Sporttrade’s slogan could well be “the Robinhood of sports betting”. By eliminating the sportsbook margin and enabling live trading, it gives bettors the agency to manage bets like a portfolio. This means a user isn’t stuck with a bet until the final whistle – a huge shift in how risk is managed. Sporttrade also touts high betting limits and liquidity because prices are set by competitive market makers, not limited by a sportsbook’s exposure cap. In essence, Sporttrade brings efficiency: tighter spreads (so bettors lose less on average) and the ability to capitalize on swings (which traders love). Another differentiator is regulatory compliance – Sporttrade is fully licensed in the states it operates, proving that the exchange model can coexist with U.S. gambling laws. This “regulated exchange” status in multiple states was uncharted territory until Sporttrade (and a direct competitor, Prophet Exchange) paved the way.
Revenue Potential: An exchange like Sporttrade has the potential to scale profitably on relatively thin margins. Every bet that gets traded multiple times (buying and later selling) generates multiple commission instances. In financial markets, exchanges thrive on high volume; similarly, if Sporttrade can attract even a small share of the $100+ billion U.S. sports betting market, volume could be substantial. For instance, New Jersey’s sports betting handle is billions per year – if even a few percent flows through Sporttrade’s exchange, with a ~2% round-trip fee, annual revenues could reach tens of millions. Moreover, Sporttrade could expand into more states or even offer exchange-traded props and parlays (currently it focuses on win/lose and some totals). Strategic revenue angles include licensing its exchange tech to other operators or white-labeling (since running an exchange requires specialized infrastructure). The presence of capital markets investors on its cap table hints at potential future integration with financial products or listing on established exchanges (CME has event contracts; Sporttrade could be a partner or acquisition target in that realm).
Pressplay Perspective: Sporttrade exemplifies convergence of sports, tech, and finance, a theme Pressplay finds compelling. It addresses the sophisticated sports fan who demands more control and better value – aligning with a trend of “financialization” of fandom. For Pressplay, which looks at the sports tech space broadly, Sporttrade is a proof point that user experience borrowed from other industries (trading apps) can unlock new engagement in sports betting. While Sporttrade itself is beyond seed stage, the underlying concept can inspire regional adaptations. Notably, the MENA region – with its finance hubs like Dubai – could be fertile ground for a similar exchange if legal frameworks allow (perhaps using crypto or operating in free zones). Sporttrade’s journey also signals that teams of domain experts (ex-finance professionals) can carve out a niche even in crowded markets through innovation. An early-stage investor can take cues from Sporttrade’s focus on better odds and user-centric design when evaluating other betting startups. Ultimately, Sporttrade’s progress will inform how and where prediction markets can gain mainstream traction.
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