Exclusive: ProphetX raises $35M for B2B sports prediction markets
Illustration: Brendan Lynch/Axios
ProphetX, a CFTC-designated sports prediction market, raised $35 million in new funding, CEO Dean Sisun tells Axios Pro exclusively.
The big picture: ProphetX aims to expand distribution and deepen liquidity beyond consumers by offering its exchange infrastructure to partners.
Zoom in: Parlay Capital and Data Point Capital led the financing, with participation from FDJ Ventures, Greenwave Ventures, Connexa Capital, Impellent Ventures, the Operating Group and Sharp Alpha Advisors.
- Strategic investors include Chicago Trading Company Ventures, Belvedere Trading, Ematiq and principals at White Swan Data and Consolidated Trading. These backers give ProphetX market-making expertise as it tries to deepen liquidity.
State of play: ProphetX operates a consumer-facing peer-to-peer sports-betting market, but is also building a B2B business that sells its exchange infrastructure to other companies.
- The company received CFTC designation as a contract market in June, giving it a federal path to operate nationally even as states and prediction-market operators clash over sports contracts.
Between the lines: The CFTC's support of prediction markets is giving companies like ProphetX a national alternative to state-by-state sportsbook licensing.
Yes, but: A bipartisan coalition of 37 state attorneys general has argued that prediction-market operators cannot use federal oversight to bypass state sports-betting laws.
How it works: Partners will be able to choose from ProphetX's sports contracts and arrange them for their customers.
- All orders feed into the company's shared liquidity pool, which should get deeper as more partners add trading volume.
- ProphetX will share commissions with those partners, while continuing to operate its consumer-facing exchange.
- Players Lounge is the first partner to go live, and the company says more are expected this summer and into the NFL season.
Context: Sisun and co-founder Jake Benzaquen started Prophet in 2018, first operating it as an exchange in the U.K.
- It launched a peer-to-peer sports-betting business in New Jersey in 2022, and later moved to a sweepstakes model after failing to expand state by state.
