Kalshi Could Leverage Soaring Valuation as Acquisition Currency

Kalshi Could Leverage Soaring Valuation as Acquisition Currency

Prediction markets Goliath Kalshi is reportedly contemplating a financing round that would value the business at over $5 billion, more than quadruple the $2 billion it was valued at after a $185 million Series C funding round in June, according to allegations that appeared last month. According to some analysts, the operator of the derivatives exchange can leverage its rising multiple to enter the sports betting market as an acquirer.

Eilers & Krejcik Gaming (EKG) stated in a recent research that it anticipates Kalshi will want to acquire companies in order to strengthen its sports betting capabilities. Perhaps more so than client-facing acquisitions, the research firm makes the case for the event contract purveyor to pursue back-end, technology-focused transactions.

"Top priority would be pricing/market-making firms that can deliver prop and same-game parlay (SGP) liquidity, alongside sports betting expertise—an area where Kalshi remains thin, in our view,” observes the research firm.

As of this point in the 2025 NFL season, opinions on whether Kalshi is providing superior value on moneyline wagers and totals than FanDuel parent company Flutter Entertainment (NYSE: FLUT) and DraftKings (NASDAQ: DKNG) are divided. The analyst community seems to agree that while traditional gambling companies are generally providing better odds, there are some NFL games with better pricing.

Parlays May Indicate the Need to Purchase Kalshi

The prediction market still has a ways to go before it can catch up to the likes of DraftKings and FanDuel on the parlay front, according to industry analysts, despite Kalshi's recent introduction of football SGPs and the modest volume of bets placed on them.

Given that multileg bets—especially those of the same-game type—are very well-liked by retail bettors and generate profits for sportsbooks, Kalshi is probably going to try to get into that market. According to EKG, that pressure can force the business to pursue agreements that improve its market-making capabilities.

“If we’re Kalshi, we’d leverage the low cost of capital and use stock as currency to move aggressively on pricing expertise,” said the research firm.

Although EKG does not name any particular businesses that may be suitable Kalshi targets, it does speculate that potential targets could be reluctant to accept Kalshi shares at what are known as "elevated multiples."

One Takeover Rumor Contains a Reference to Kalshi

Recently, Kalshi was at the focus of some rumors about mergers and acquisitions. According to rumors last month, that business and rival Polymarket discussed the possibility of purchasing rival Novig.

Novig, a privately held company, operates a peer-to-peer prediction market with a sole concentration on sports, therefore it would support Kalshi's sports presence and possibly contribute to the technology.

According to rumors, Novig may be the target of several bidders besides Kalshi and Polymarket, indicating that the company may face fierce competition. Novig may be a willing seller, but it's unclear if it's actively shopping itself.