A new venture capital firm focused on prediction markets is launching with backing from Polymarket founder and CEO Shayne Coplan and Kalshi co-founder and CEO Tarek Mansour. The firm, called 5c(c) Capital, plans to raise $35 million to fund startups tied to the rapid growth of event-based trading markets. This initiative marks a significant expansion of capital into the sector following recent regulatory clarity and increased user adoption.
The fund aims to invest in about 20 early-stage startups over the next two years to support the ecosystem. Investment targets include infrastructure and services such as data tools, liquidity provision, and compliance systems rather than exchanges alone. This strategy reflects a maturation of the industry where supporting ecosystems become as valuable as the trading platforms themselves.
Launch timing coincides with a surge in trading volumes and new users entering the space globally. Since the United States presidential election, platforms like Polymarket and Kalshi have hosted contracts tied to politics, economic data, and cultural events. Public opinion is increasingly turning into tradable signals across these digital venues with significant volume and engagement levels.
Major players in the crypto and retail trading sectors are also entering the space to capture this demand. Companies including Coinbase and Kraken, as well as Robinhood, have launched prediction market features in recent months. Polymarket trades run on the blockchain while others utilize traditional settlement layers for user safety and speed.
5c(c) Capital plans to focus on early-stage bets tied to infrastructure and services around prediction markets. The firm named its entity after a section of the Commodity Exchange Act that governs prediction markets specifically. This naming convention highlights the regulatory importance of the new investment vehicle in the financial sector.
Early backing includes more than 20 investors among them a portfolio manager at Millennium Management. Additional backers include several crypto-focused venture firms and founders of other prediction market platforms such as PredictIt. The diverse investor group signals broad confidence in the long-term viability of the market structure.
The founders wrote in a document viewed by Bloomberg that they want to capitalize on the second, third, and fourth-order effects of what they built themselves. This statement indicates a recognition that the primary market platforms are only the beginning of the economic activity. They aim to capture value from the surrounding service layers that emerge as volume increases significantly.
The launch comes as prediction markets shift from a niche corner of finance into a more visible part of how people track events. This transition suggests a fundamental change in how information is aggregated and priced by the public. Traditional forecasting methods face competition from crowd-sourced probability assessments on these platforms.
Broader implications include the potential for standardized compliance tools to emerge across the industry as volume grows. Investors will watch how 5c(c) Capital deploys its capital to identify which service layers offer the most defensibility. The next two years will determine whether this infrastructure demand translates into sustainable revenue streams for portfolio companies and the wider market.
