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Novig, which runs a sweepstakes-based sports prediction market, raised $18 million in Series A funding led by Forerunner Ventures, CEO Jacob Fortinsky tells Axios Pro exclusively.

Why it matters: The company says its peer-to-peer model promises more transparency in a sector marked by opaque odds.

State of play: Novig initially launched in Colorado by partnering with a licensed sportsbook, but pivoted to a sweepstakes framework last year.

Yes, but: Some states like New York, Louisiana and Mississippi have begun to crack down on sweepstakes-based gaming.

What he's saying: "We have a bona fide, free-to-play product that gives users all the fun of prediction markets without putting in real dollars," Fortinsky says. "We're not just trying to leverage some loophole."

How it works: Novig's platform lets users bet against each other, rather than the house, allowing them to set or take odds themselves.

The New York-based company makes money primarily by selling redeemable coins — called Novig Cash — and by participating in a small share of trades to provide liquidity.

Novig also works with institutional market makers who help provide liquidity to the exchange, which has helped drive its share of bets on the platform from 40% to around 3%, Fortinsky says.

He claims users are more than 10 times as likely to win on Novig compared to traditional sportsbooks, where odds are structured for the house to win.

Between the lines: Forerunner is best known for backing consumer commerce brands, making this a rare move into prediction markets.

"I think there's a lot of room [for Novig] to become a best-in-class brand and experience for the people they're serving," Forerunner principal Fawzi Itani says. 

Y Combinator, NFX, Perceptive Ventures and Gaingels also participated in the round.

By the numbers: Novig hit $2 billion in annualized trading volume within 11 months of its September 2024 launch, Fortinsky says.

He adds that the platform has a 75% 30-day retention rate and 60% retention at 90 days, which he claims is far ahead of competitors.

The company got its first burst of users launching at the start of the NFL season last year, but it has continued to grow thanks to NBA and WNBA trading.

What's next: Novig plans to introduce a web app next month and expand to more sports, with features like leaderboards, group contests, and head-to-head trading on the roadmap.

Exclusive: P2P sports prediction startup Novig raises $18M

Startup claims users win 10× more than on other sportsbooks.

Photo illustration of a hundred-dollar bill with Ben Franklin wearing a football helmet.

Photo illustration: Brendan Lynch/Axios. Photo: Cliff Welch/Icon Sportswire via Getty Images

Novig, which runs a sweepstakes-based sports prediction market, raised $18 million in Series A funding led by Forerunner Ventures, CEO Jacob Fortinsky tells Axios Pro exclusively.Why it matters: The company says its peer-to-peer model promises more transparency in a sector marked by opaque odds.

Exclusive: P2P sports prediction startup Novig raises $18M

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