The US sports activities betting market has expanded quickly since widespread legalization in 2018, however the dominant enterprise mannequin nonetheless capabilities on a structural tilt towards the person: sportsbooks embed their margin into each transaction, set costs with little transparency, and routinely restrict or ban contributors who win too persistently. Fewer than 2% of customers on conventional sportsbooks flip a constant revenue – not as a result of most sports activities bettors lack ability, however as a result of the home extracts worth from each wager earlier than the end result is even decided. Novig addresses this structural downside at its root by working as a commission-free, peer-to-peer trade the place merchants compete straight towards each other on sports activities outcomes, reasonably than towards the platform itself. By eliminating the embedded margin often called the “vig,” Novig produces tighter spreads and market-driven pricing that rewards analytical bettors on a genuinely degree taking part in discipline – the platform studies that its customers are greater than ten occasions as more likely to be worthwhile as these on standard sportsbooks. With annualized buying and selling quantity now exceeding $4B following a 10x improve in 2025, and a proper utility filed with the Commodity Futures Buying and selling Fee (CFTC) to grow to be a federally regulated trade working in all 50 states, the corporate is positioning the prediction market mannequin as a structural alternative for the incumbent sportsbook business.
AlleyWatch sat down with Novig Cofounder and CEO Jacob Fortinsky to be taught extra concerning the enterprise, its future plans, current funding spherical, and far, rather more…
Who had been your traders and the way a lot did you elevate?
Novig has raised $108M to this point from a few of Silicon Valley’s prime traders together with Pantera, Forerunner, Multicoin, Lux, YC, NFX, Paul Graham, and Joe Montana. Our final spherical was a $75M Collection B led by Pantera Capital.
Inform us concerning the services or products that Novig gives.
Novig is the fastest-growing sports activities prediction market in America. It’s the solely platform to supply commission-free, peer-to-peer buying and selling on sports activities. We ship higher pricing, full transparency, and a extra environment friendly market construction for customers by eliminating the normal sportsbook mannequin.
By eliminating the vig, unfair odds, and punitive limits on profitable gamers, Novig has constructed the business’s most equitable sports activities prediction platform.
What impressed the beginning of Novig?
Novig was impressed by my early fascination with prediction markets and the concept that markets, when designed appropriately, can floor reality extra successfully than virtually anything. In highschool and school, I spent a number of time betting on politics. What hooked me wasn’t simply the possibility to earn money; it was the sensation that I had noticed an actual market inefficiency and will achieve an edge over different contributors. It felt meritocratic and intellectually sincere.
After I later shifted that very same curiosity to sports activities betting, I anticipated a fair higher model of that have. Sports activities have large quantities of information, fixed info circulate, and thousands and thousands of passionate contributors — it needs to be the right atmosphere for environment friendly markets. As an alternative, I discovered the alternative: the ecosystem was outdated and basically unfair. Sports activities books acted as the home, setting opaque costs and limiting or banning profitable gamers.
A lot of my buddies and I had been restricted and shut out merely for being worthwhile, which made it clear the system wasn’t constructed for contributors to win; it was constructed for the home to extract worth.
Novig got here from wanting to repair that.
How is Novig totally different?
We got down to construct a real trade, extra just like the political prediction markets I admired, the place customers commerce towards one another, not towards a e-book, and the place the platform’s incentives are aligned with its clients. The purpose is a extra clear, environment friendly, and truthful market, one the place ability is rewarded, not penalized.
Conventional sportsbooks construct in giant margins and hidden charges, known as “vig,” which suggests customers are persistently paying a premium each time they place a guess. As a result of Novig operates as an trade, costs are extra environment friendly and spreads are tighter — so merchants preserve extra of what they win. It’s a structurally higher deal.
What market does Novig goal and the way massive is it?
Novig is constructed for the sports activities betting group, a worldwide business with greater than $2T in annual betting quantity.
What’s your online business mannequin?
Novig generates income by charging institutional market makers. That is what permits us to be the one platform to supply actually commission-free buying and selling to retail customers.
How are you getting ready for a possible financial slowdown?
We’re targeted on constructing probably the most environment friendly, user-friendly product. Financial cycles fluctuate, however sports activities don’t cease: seasons proceed, followers keep passionate, and communities stay engaged. We serve that keenness in a approach that delivers actual worth. If we keep disciplined, customer-centric, and mission-driven, we imagine we’re properly positioned no matter broader macro situations.
What was the funding course of like?
From the start, we’ve been intentional about selecting long-term companions, not simply capital. We ask ourselves: Will we share values? Will we belief one another? Can we see ourselves working collectively for the subsequent decade? Alignment issues simply as a lot because the examine measurement.
We’ve been considerate about bringing in traders who supply strategic experience in areas that matter most to our development. We’ve prioritized companions who not solely imagine deeply in our imaginative and prescient and our potential to execute, however who can actively assist us speed up it. These are the traders who stay aligned and invaluable over the long run.
What are the most important challenges that you simply confronted whereas elevating capital?
We’ve been lucky to carry on unbelievable traders, however the path hasn’t all the time been easy. At one level, we raised a bridge spherical whereas executing a pivot, which requires traders to imagine in our staff’s potential to reinvent the enterprise. Moreover, we function in a comparatively new class, and educating traders has been a part of the journey. Some are hesitant to again rising areas, so we’ve needed to be clear, disciplined, and compelling in articulating each the chance and our differentiated strategy.
What components about your online business led your traders to put in writing the examine?
We sit on the intersection of two converging traits: mainstream adoption of sports activities betting and the rising credibility of prediction markets as a extra environment friendly, clear option to value outcomes.
Inside prediction markets, we’re targeted on what we imagine is the biggest business alternative: sports activities. Sports activities naturally lend themselves to market-based forecasting with fixed knowledge, passionate followers, and real-time info circulate. Our purpose is to construct probably the most intuitive, liquid, and trusted sports activities prediction market on the earth.
Inside prediction markets, we’re targeted on what we imagine is the biggest business alternative: sports activities. Sports activities naturally lend themselves to market-based forecasting with fixed knowledge, passionate followers, and real-time info circulate. Our purpose is to construct probably the most intuitive, liquid, and trusted sports activities prediction market on the earth.
On the sports activities betting facet,the business is evolving. Customers have gotten extra refined and need higher pricing, transparency, and modern merchandise. Whereas betting and prediction markets are converging, our focus is on constructing deeper, extra dynamic markets with superior stats, participant efficiency, and codecs that attraction to the subsequent technology of analytically minded followers.
What are the milestones you propose to realize within the subsequent six months?
Our prime precedence is accelerating development whereas persevering with to reinvest within the product and the ecosystem.
That begins with onboarding extra customers and increasing our attain, making it simpler than ever for each new and skilled merchants to find, perceive, and take part in sports activities prediction markets. On the similar time, we’re targeted on growing buying and selling quantity and liquidity, as a result of deeper markets create a greater expertise for everybody.
In the end, all the things we’re doing ladders as much as constructing an equitable, trader-first market that scales responsibly, earns belief, and turns into the default house for sports activities prediction buying and selling.
What recommendation are you able to supply firms in New York that do not need a recent injection of capital within the financial institution?
Keep alive. We executed a number of pivots to allow us to proceed to get suggestions from our customers and after 4 years Novig actually hit escape velocity.
The place do you see the corporate going now over the close to time period?
We’ve utilized for CFTC registration to function as a federally regulated trade, which might enable us to launch nationally. Our focus is on launching and being out there throughout all 50 states.
What’s your favourite winter vacation spot in and across the metropolis?
Snowboarding in Vermont, the place we simply hosted our company-wide retreat.
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