Sports Betting Startup Novig Raises $75 Million, Targets CFO Scrutiny of Traditional Sportsbooks

A Harvard-founded prediction market startup is betting that finance chiefs will eventually care about the economics of sports gambling—and that peer-to-peer betting beats the house model that's minting billions for FanDuel and DraftKings.

Novig announced Tuesday it has raised $75 million in Series B funding led by blockchain venture firm Pantera Capital, valuing the company at $500 million. The timing is pointed: while rivals Kalshi and Polymarket dominate regulatory attention and trading volume, Novig is positioning itself as the "consumer-friendly" alternative in a market it claims systematically rips off users.

For finance leaders, the pitch is less about gambling and more about market structure. Novig operates as a peer-to-peer exchange rather than a traditional sportsbook, meaning users trade against each other instead of against the house. It's the difference between a stock exchange (where buyers and sellers meet) and a casino (where the house always has an edge). Cofounder Jacob Fortinsky argues this structure is "the most profitable way possible" for bettors—which, if true, suggests traditional sportsbooks are extracting rents that a more efficient market could eliminate.

"We started the company because we felt sports betting was broken," Fortinsky told Fortune. "Our mission from day one was to build a platform really built for modern sports bettors in the most consumer-friendly, the most engaging, and the most profitable way possible."

The regulatory path has been messy. Fortinsky and cofounder Kelechi Ukah launched Novig in 2021 during their senior year at Harvard, entering Y Combinator in 2022. But the prediction market landscape was treacherous—Polymarket was banned from U.S. operations that same year for offering unlicensed betting. Novig initially registered as a regulated sports betting operator in Colorado, then pivoted to a sweepstakes model, but neither allowed national operation. The sweepstakes approach drew legal challenges from state regulators.

Now Novig is applying to operate under the Commodity Futures Trading Commission, which Fortinsky expects to complete within six months. That's the same regulatory path Kalshi used to unlock its 2024 court victory, which dramatically expanded what prediction markets could offer beyond weather forecasts and award show outcomes. Today, according to the source, the vast majority of Kalshi's volume comes from sports contracts—despite some state governments seeking to limit or shut down sports-based prediction markets.

The market opportunity is enormous. A 2018 Supreme Court decision opened the floodgates for states to legalize sports gambling, and betting has "seeped into every corner of the U.S. economy" since then, according to Fortune's characterization. For CFOs at media companies, sports leagues, and gaming operators, the question is whether peer-to-peer models like Novig's can actually undercut the established sportsbook oligopoly—or whether regulatory fragmentation and user acquisition costs will keep the incumbents entrenched.

Pantera Capital's bet suggests venture investors think there's room for disruption. But Novig still needs CFTC approval to operate nationally, and even then, it's entering a market where FanDuel and DraftKings have spent years building brand recognition and state-by-state licensing. The company's argument that its model is "more profitable" for users is compelling in theory. Whether it's compelling enough to overcome the inertia of an industry that's already captured millions of customers—and their CFOs' marketing budgets—remains to be seen.