QUICK SPARK: Kalshi Investment Jumps 77% for ERShares' XOVR ETF as Startup Hits $40 Billion Valuation

ERShares’ Private-Public Crossover ETF (NASDAQ:XOVR) is sitting on an estimated $23.1 million unrealized gain from its investment in prediction markets platform Kalshi.

ERShares invested $30 million in Kalshi at a $22.6 billion valuation. Following the company’s latest funding round, which valued it at approximately $40 billion, XOVR’s stake is now worth an estimated $53.1 million, representing a nearly 77% gain before transaction costs.

The investment reflects XOVR’s growing focus on backing private companies earlier in their growth cycles, rather than waiting until they approach an IPO. The fund also holds an investment in SpaceX.

QUICK CONTEXT: ETFs Expand Access to Private Markets

Traditional ETFs primarily invest in publicly traded securities, but private-public crossover funds are attempting to bridge the gap between public and private markets. These funds combine listed companies with stakes in privately held businesses, allowing retail investors to gain indirect exposure to companies before they go public.

ERShares launched XOVR’s private-company investment strategy in August 2024, using its proprietary VC Lens framework to identify businesses with founder-led management, disruptive business models and long-term growth potential. However, private-company valuations are typically based on funding rounds and valuation procedures rather than continuous market trading. Consequently, unrealized gains may differ from the eventual value investors can realize when stakes are sold or companies go public.

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