Unlike gambling sites where revenue equals customer losses, Kalshi's exchange model takes a small fee on trades. This means they are incentivized to foster a healthy ecosystem with smart traders who create liquidity and improve the product's forecast accuracy, a fundamentally different business model.

Robinhood invested in Rosera rather than building its own prediction market exchange to avoid conflicts of interest, heavy regulation, and liquidity fragmentation. This separation of broker and exchange functions is standard in traditional equity markets but contrasts sharply with the vertically-integrated model common in crypto.

Robinhood's strategy is not just to offer prediction markets as a standalone product. They serve as a top-of-funnel acquisition channel, attracting new, gaming-oriented users who can then be introduced to more stable, long-term products like retirement accounts and banking services.

As Kalshi surpasses $2B in annualized revenue, it's leveraging informal IPO talks to push potential underwriting banks to integrate with its exchange. This strategy aims to get the banks' institutional clients trading on its platform, diversifying Kalshi's user base beyond retail investors.

Conveyo’s model is to provide infrastructure that realigns incentives between disconnected parties rather than replacing them. By acting as the sole, independent party managing the process end-to-end, they introduce accountability and transparency, making the entire system more efficient.

Robinhood views prediction markets not just as a standalone product but as a powerful information and trading layer for traditional assets. The plan is to display relevant prediction markets (e.g., for EPS, revenue) directly on a company's stock page, offering investors a more comprehensive analytical view.

If you're a foundational platform, you will inevitably compete with customers building on top of you. Address this transparently by informing them of your product roadmap. A large market allows for 'coopetition' where you can partner, compete, and sell to each other simultaneously in a healthy ecosystem.

Prediction market Kalshi adopted a "regulatory-first" approach, similar to Coinbase. This difficult path built essential trust, directly enabling partnerships with Robinhood, Coinbase, and CNN, demonstrating how compliance can be a powerful moat and business development tool.

Susquehanna's strategy for bringing institutional clients to prediction markets is not to build direct relationships. Instead, they partner with intermediaries like brokers, banks, and insurance companies who already advise clients on risk, positioning themselves as the ultimate liquidity provider.