Over Labor Day weekend, social media lit up with observations that President Trump had not been seen in public for several days. Soon, rumors swirled about Trump’s health—and ghoulish hashtags even claimed he had died. Yes, it was just another weekend in the online rumor mill, but this round of speculation came with a novel twist: a flurry of bets about the president’s health on so-called prediction market sites. On Kalshi, the odds of Vice President JD Vance taking office by the end of the year shot up to 15%. For Kalshi customers, a wager of $15 would mean a payout of $100 if Vance took office.
Trump’s alleged disappearance, of course, proved a false alarm. By Tuesday, the internet had moved on to other diversions—but not before pundits blasted Kalshi and its prediction markets rival Polymarket for running “assassination markets,” where the public could (indirectly) wager on the death of a public figure.
Those accusations may have been overblown—not least because one of Trump’s sons invests in and advises both Kalshi and Polymarket. But the episode showed how prediction markets, long the province of a niche clique of academics, have suddenly become a mainstay of politics and the news cycle.
They are also on the cusp of becoming big business.
Kalshi and Polymarket have been around for seven and five years respectively, but their big breakout came during last year’s U.S. presidential election campaign. Over the course of several months, millions of people convened on the platforms to wager more than $3 billion on the outcome, resulting in forecast that proved far more accurate than the most highly regarded polls. For the startups’ founders, this proved their thesis: that the platforms’ blend of crowdsourced wisdom and financial self-interest offers an unprecedented window into future events.
Right now on Kalshi and Polymarket, those future events include profound geopolitical and economic questions, like whether China will invade Taiwan by the end of 2025 (6% as of mid-September) or how many rate cuts the Fed will implement by end of year (14% for two cuts). There are also plenty of more frivolous wagers, like whether Taylor Swift will get pregnant in 2025 (15%).
To their backers, these wagers (“events contracts” in prediction markets parlance) represent a promising new industry—and a potentially powerful tool that investors could use to hedge their portfolios, or that businesses could use to predict consumer demand. Sequoia venture capitalist Alfred Lin describes the markets to Fortune as “basically truth machines.”
Seizing on a favorable environment for fintech experimentation, Lin and others have poured hundreds of millions of dollars into Kalshi and Polymarket (each of which now enjoy $1-billion-plus “unicorn” valuations) and a handful of smaller platforms; public companies like Robinhood are also jostling for a piece of the action. Right now, monthly wagers on Polymarket and Kalshi are totaling well over $1 billion, while analytics firm Similarweb says the sites attracted over 35 million visitors this summer.
Still, the emerging sector is fraught with risks. While their supporters envision prediction markets as nimble tools for peering into the future, many others—including, it seems, most of the people actually using them—see them as just another way to gamble. If the markets come to be seen primarily as just another casino, they are likely to lose the moral and intellectual high ground their boosters have touted. That’s not to mention the challenge of the brutal competition and legal jeopardy that would go with operating in the tightly regulated gaming industry.
There’s also the public unease around platforms that permit wagers on war or the health of politicians in a time of general social upheaval—an unease intensified by the murder of conservative activist Charlie Kirk. And some question whether the two leading prediction market companies can be trusted to run their startups responsibly. In the past year, the founders of both Kalshi and Polymarket have engaged in eyebrow-raising antics that could give pause to investors and regulators alike.
The biggest risk hanging over the industry, though, is a basic business question: Can sites like Kalshi and Polymarket generate sustained interest—and revenue—outside of the once-in-four-years presidential contest?
Prior to election night, nearly $211 million of prediction market bets came flooding in. The following day, gleeful winners lined up to collect—pleased to have anticipated the triumph of the Democratic incumbent, Woodrow Wilson.
That was in 1916, a year that would prove to be the high-water mark of U.S. prediction markets for over a century. When these markets surged back to prominence in last year’s Trump-Harris contest, they were clothed in Kalshi and Polymarket’s digital wrapper. But the underlying mechanics are very much the same as in Wilson’s era.
You can think of prediction markets as wagers that are fluid. Unlike casinos or conventional betting sites, where bettors place a fixed wager against the house, participants on Kalshi and Polymarket bet against one another and can close out their “event contract” anytime. Like stock exchanges, prediction markets serve as a matching service between buyer and seller.
For instance, a contract for a heavily favored election candidate might cost 80¢, which locks in a $1 payout if the candidate wins. The opposing bettor buys a 20¢ ticket that pays $1 if the other candidate wins. But if the favored candidate suffers a major scandal, the value of that contract might drop to 40¢—leaving the owner to decide whether to sell it to another bettor or hold it till the election results come in.
While this is a form of gambling, proponents argue that any negative social effects are outweighed by the powerful signals the contracts can provide to markets about everything from weather in harvest season to whether a given politician will be elected. In practice, the closer to $1 the value of the event contract comes, the greater the likelihood of the event coming to pass. As the Trump election results demonstrated, the markets can be uncannily accurate—and the more people participate, the more accurate they theoretically become.
According to Kalshi cofounder Tarek Mansour, that accuracy is the result of two interlocking factors. “They’re a market-based mechanism, so you get the wisdom of the crowds,” he explains. “Number two, skin in the game. When people have real money on the line, they don’t lie.
Why did something so useful fall out of favor in the first place? The best answer is that prediction markets got swept up in broader Progressive Era campaigns against gambling, just as the rise of scientific polling pioneered by George Gallup provided a useful alternative. (Ironically, the anti-gambling crusades of that era often spared horse racing, since, in the eyes of the moralists, it enjoyed an association with rural American virtue—while also teaching young, military-age men to size up horseflesh.)
Robin Hanson, a George Mason University professor, sees the debate over prediction markets as part of a longtime push and pull between those who view tools for speculation as a moral threat, and those who see them as useful. “Moralizing about betting markets goes up and down in cycles,” Hanson observes. “Pretty much all financial markets were illegal at some point, including stocks and life insurance.”
In this view, prediction markets are taking their place next to products like options and futures contracts, which regulators long frowned on as overly speculative, but are now viewed as important market signals.
Lin of Sequoia is a Kalshi board member who studied prediction markets in college, and he believes they offer a superior way to hedge against uncertainty, allowing investors to fortify themselves against, for example, adverse interest rate movements. “Right now, the way to do that is to look for interest-sensitive stocks and either buy or short them,” says Lin. “There needs to be a better way.”
Mansour says first-hand experience led him to the same conclusion; he once worked on the “exotics” desk of Goldman Sachs, where he built baskets of stocks to help customers take positions on events like Brexit.
This push to open prediction markets follows decades of the U.S. banning them—though not entirely. In 1998, the Commodity Futures Trading Commission (CFTC) permitted an entity called the Iowa Electronic Markets to run betting platforms in which a small group of academics could wager very small amounts. The agency then gave permission in 2014 to a successor group, PredictIt, to operate a somewhat broader version.
In the past two years, the legal chains holding back prediction markets have largely vanished. But the current era of these markets is being shaped by startup founders with a penchant for bending the rules.
“Bruh!” Shayne Coplan’s curly head yells on my iPhone screen shortly before last year’s election. It’s clear Coplan is sore over a Fortune story that revealed that many of the wagers on Polymarket had come from fishy trades.
That revelation didn’t dim the general enthusiasm around Polymarket, and in the subsequent months, I repeatedly propose Zoom or in-person meetings so Coplan can tell me the full story. Nope: Coplan prefers to do it his way, with direct messages and ambush video calls over Signal, where he has chosen the Beatles’ Revolver cover as his avatar.
The 27-year-old Coplan, a New York City kid who got deep into cryptocurrency in high school, started Polymarket in 2020 after dropping out of NYU. One of his backers, Rob Hadick of Dragonfly Capital, describes him as brilliant, with a deep, all-consuming passion for probabilities. Recent accounts and photos of Coplan reflect a founder with a cooler-than-thou affect possessed of deep confidence—or perhaps overconfidence. Recalling encounters with him, two crypto executives told Fortune of Coplan comparing himself to Apple founder Steve Jobs.
Coplan has also brought his swagger to the way he operates his company. In 2022, Polymarket was hit with a CFTC consent decree barring it from operating in the U.S. Despite this, there’s ample evidence that the site turned a blind eye to Americans who placed bets by using a VPN to mask their location. (Polymarket disputes this characterization.) It’s quite possible that this conduct—or Polymarket’s decision to pay U.S. influencers to promote the site—explained the Justice Department’s decision shortly after the election to raid Coplan’s apartment and seize his smartphone and other devices.
The sensible response to a federal raid is to let your lawyers do the talking. Coplan chose another strategy. Days later, he took to X to tweet “New phone who dis?” The gesture amounted to taunting the prosecutors but would ultimately do him no harm; months later, the Feds dropped the investigation without filing charges.
If Coplan relishes being the enfant terrible of prediction markets, Kalshi’s cofounders have taken a different tack. Mansour and cofounder Luana Lopes Lara are eager to talk up their track record of compliance. This included staying well clear of the U.S. market until September 2024, when Kalshi prevailed in a lawsuit against the CFTC, with a federal judge ruling the agency lacked jurisdiction over events contracts unless they concerned “assassination,” “terrorism,” or “gaming.”
Mansour, 29, is slightly disheveled and shares little in common with Coplan save for a fixation with probabilities. Born in California, the Kalshi CEO returned with his parents to a Christian village in Lebanon as a young child. “We went through a few periods of war or terrorism. It was an anxiety-inducing period,” recalls Mansour, adding that he responded to the turmoil by becoming obsessed with math, and then with getting into MIT. Today, he posts his 5.0 GPA from the university on his LinkedIn page.
His cofounder has a different story and mien. Lopes Lara, also 29 and an MIT grad, was born and raised in Brazil and became a professional ballerina before abruptly pivoting to mathematics. Polished and easy in conversation, she recalled moments when prediction markets directly intersected with her own life.
The question “will Kalshi or Polymarket win the most market share?” would be great fodder for a crowdsourced answer.
“The Kalshi markets started predicting that [COVID] was going to pick up again around Thanksgiving a couple years ago, and we made our own return-to-office decisions thinking about this,” she recalls. The prediction proved correct, she adds: “It was very cool to see and follow it, since you could predict what was going to happen in the news a week later.” Lopes Lara also remembers taking a keen interest in a more trivial wager over whether the band One Direction would reunite, and realizing to her deep disappointment that they wouldn’t.
The Kalshi cofounders run a tight ship, with Mansour serving as the public face of the company while Lopes Lara runs internal operations. The team closely vets new events contracts and has added rules to address unanticipated or controversial outcomes. Those include the “will Trump leave office” contract: Under Kalshi rules, that contract will pay out only partially in the event the president dies, rather than paying out “yes” bettors in full.
Polymarket has no such provision for its “will Trump leave office” contract. It has also listed other bets that ended in controversy—among them, a recent wager over whether the president of Ukraine would wear a suit at a White House visit. When Volodymyr Zelensky turned up in black raiment that media outlets described as a suit, Polymarket nonetheless chose to pay those who bought “no” contracts. That decision followed a shadowy dispute-resolution process involving a vote among holders of an obscure cryptocurrency—hardly the kind of adjudication that mollifies critics or customers.
Coplan’s site has given rise to other controversies, including its decision in January to list contracts on when the catastrophic fires around Los Angeles would be contained—wagers that detractors blasted as “arson markets.” The site, which relies on crypto-based contracts, has also drawn flak for being a locus of “wash trading,” identified by blockchain forensics firms, which involves transactions in which one person takes both sides. While wash trading is common on many crypto sites as a way for traders to artificially bump up a coin’s liquidity or feign momentum, its presence makes it hard to ascertain the true volume of wagering on Polymarket. (“Polymarket’s Terms of Use expressly prohibit market manipulation,” a company spokesperson said in response to an earlier Fortune article that examined the issue.)
Kalshi has had fewer legal and ethical stumbles than Polymarket, but the startup hasn’t always modeled good corporate behavior. Most notably: The site responded to news of the FBI’s raid on Coplan’s house with a dirty-tricks campaign that paid at least four influencers to post social media comments highlighting the episode. Among other moves, Kalshi asked the former NFL star Antonio Brown to tweet news of the incident along with the comment “this nigga seems guilty,” which Brown promptly did. Soon after, tech news site Pirate Wires published direct messages linking Kalshi employees to the campaign.
At the time, Kalshi declined to condemn the behavior or discipline the employee responsible. When asked about the episode in a recent interview, Lopes Lara expressed regret, saying the person responsible had not informed her or Mansour about the plan. “Everyone makes mistakes,” she said. “That was a mistake; it was over the line. It’s not something we identify with or would do again.”
While Polymarket and Kalshi have skirmished and pushed boundaries, investors have only grown more enthusiastic. This June, Polymarket finalized a $200 million investment led by Peter Thiel’s Founders Fund, valuing the startup at $1 billion. Meanwhile, Kalshi the same month raised $185 million from Sequoia, Paradigm, and others, at a $2 billion valuation. In September, an anonymously sourced report on tech website The Information claimed both companies were raising more money at significantly higher valuations.
That investor enthusiasm coincides with buzz among news outlets and on social media. But that doesn’t mean the platforms are a sure bet as a business.
Polymarket and Kalshi both peaked on Election Day, when Mansour recalls his site eclipsing even Pornhub (the internet’s most popular destination most days). Since then, no wager listed on either site has come close to re-creating the billions of dollars of bets generated by the Trump-Harris contest. Daily app downloads last October topped 100,000 for Kalshi and 50,000 for Polymarket, according to the companies; the respective figures this June were closer to 6,500 and 650, according to Apptopia.
For now, it’s hard to do a head-to-head comparison between the two companies. Kalshi leads in app download figures. Web traffic tells a different story: Similarweb says Polymarket received 31.7 million visitors between June and August while Kalshi received 4.5 million. But Polymarket’s wash-trading phenomenon is very likely inflating its traffic volumes, while Kalshi’s app advantage can be discounted by the fact it has been the only one of the two allowed to operate in the U.S.
For Kalshi, victory in last year’s CFTC case has served as a regulatory moat to give it a competitive edge. For months, the company also appeared to have an additional political ace up its sleeve in Washington, D.C., in the form of Donald Trump Jr., who became a paid advisor in January. Kalshi’s advantages have quickly eroded, however. Polymarket recently acquired a company that will soon enable it to operate in the U.S. without violating its ongoing consent decree. And Don Jr. revealed in August that his venture capital firm, 1789 Capital, had invested in Polymarket, and that he has joined that startup’s advisory board as well.
Prediction markets may also not be a two-horse race for much longer. New competitors include startups like Railbird and one called The Clearing Company—started by former Polymarket executives. Trading giant Robinhood has also jumped into the sector, offering a series of wagers on high-profile sporting events via third-party partners, including but not limited to Kalshi.
There’s also uncertainty around how these firms plan to make money. The most obvious model is by charging commissions: Kalshi charges around 1% on bets by customers, who are currently wagering an average of $19 million per day. For now, Polymarket is charging no fees, though Hadick, the venture investor, says the site could easily earn several hundred million dollars a year if it did so. Both sites are also signing partnerships with media and AI companies that could yield revenue in the form of data licensing or research fees. Crypto could be another revenue stream: Polymarket is rumored to be launching a digital token, and Kalshi is rushing to embrace blockchain.
All of this, though, will depend on the companies creating a critical mass of liquidity for prediction markets—and a growing reputation for accurate predictions—by persuading everyday people to use them. According to Lin of Sequoia, these tools will follow the same trajectory as any other new technology, spreading from early adopters to the broader public as they become more familiar.
Kalshi’s most popular bets since last year’s election night offer a glimpse of how that adoption might occur. Recent buzzy contracts include wagers on the New York City mayoral race and two sporting events. But Kalshi bettors also rushed to place wagers on Trump’s Liberation Day tariffs, and on the resignation of the notorious “kiss cam” Astronomer CEO.
For now, it appears both sites are devoting most of their promotional efforts to sports-related wagers. While that opportunity appears to be low-hanging fruit—Kalshi’s biggest non-election success came in the form of more than $500 million in bets on March Madness—it also may be short-lived. Ordinarily, the sports wagers would be a clear violation of state regulations on gaming, which govern casinos and betting sites like DraftKings. Kalshi and Polymarket are relying on somewhat convoluted legal reasoning that “events contracts” are different from gambling. While Kalshi prevailed in one court ruling, it is not hard to imagine another court finding otherwise—and several lawsuits are proceeding through state courts.
Ultimately, questions like “Will Kalshi or Polymarket win the most market share?” or “Will an appeals court ban sports betting on prediction markets?” would be great fodder for a crowdsourced answer from a large group of people with skin in the game. For now, at least, those are two bets you won’t find on Kalshi or Polymarket.
The bets drawing wagerers to prediction markets
Politics made Kalshi and Polymarket famous, but other topics are attracting big money
$130.5 million 2025 NBA Finals: Oklahoma City or Indiana?
$88.5 million Sept. 2025 Fed rate decision: How big a cut?
$504.2 million March Madness, 2025: Picking NCAA hoops winners.
$218.8 million*
Daily temperatures in multiple cities
$67.8 million* Rotten Tomatoes scores: Ratings on the review site. Recent bets on Kalshi. *Money wagered cumulatively in long-running betting series (as of 9/17/25)
This article appears in the October/November issue of Fortune with the headline “Wanna bet? Why investors are gambling on Kalshi and Polymarket.”
Good morning. Chickenjoy—its crispy, juicy fried chicken—and Jolly Spaghetti are signature menu items at Jollibee, a Filipino fast-food chain that is building a growing fan base in the U.S. Now, the company is setting its sights on Wall Street.
The Philippines-based Jollibee Foods Corporation (JFC), the restaurant’s parent company, disclosed earlier this month that it plans to spin off its international operations and pursue a U.S. initial public offering for that business. The contemplated spin-off and listing are targeted for late 2027, leaving “quite a bit of time ahead of us for the work to be done,” Jollibee Global CFO Richard Shin said during a Jan. 14 media roundtable.
JFC, which includes restaurant brands such as Smashburger and The Coffee Bean & Tea Leaf, is currently traded as a single group on the Philippine Stock Exchange and operates in 33 countries. Over the past 15 quarters, JFC’s international network has posted a 26.7% compound annual growth rate, outpacing the group’s overall 15.1% rate of expansion. The separation reflects increasingly distinct strategic profiles for the domestic and international businesses, Shin said.
In March 2025, Jollibee launched its first U.S. franchising program. After opening its first North American location in 1998 in Daly City, California, the brand has since expanded to more than 100 locations across the U.S. and Canada as of early 2026.
Why go the route of a U.S. IPO? “I think there’s a fact that we can all agree on: the U.S. capital markets have deep investor-based experience in valuing global consumer and restaurant growth companies,” Shin said on the call.
Many such companies are still growing into their potential yet are often rewarded with higher multiples and valuations, he said. While that outcome is not guaranteed for JFC, a U.S. listing offers greater capital depth, liquidity, and broader analyst coverage, with any final decision subject to valuation and required approvals, he added.
The IPO market in the U.S. is heating up again, Fortune’s Jeff John Roberts writes in a new feature article. “While 2026 will almost certainly not match the banner year of 1999, which saw 476 companies go public, investors should have far more choices than they did four years ago, when just 38 firms held an IPO,” he writes.
Shin also framed the separation of JFC in terms of simplifying how investors assess the corporation, noting the group includes businesses at different stages of their life cycles, with varying returns and opportunities. Distinct domestic and international entities, he suggested, could offer investors clearer, more targeted investment options as the strategic profiles of the two segments continue to diverge.
Reasons for pursuing the separation include improved transparency, discipline in capital allocation, execution against the growth strategy, and the ability to attract an investor base aligned with the risk–return profile of each business rather than being judged solely on short-term financial metrics, he said.
“The transaction is aligned with the Jollibee Group’s long-term value creation strategy,” Shin said.
With its eyes on Wall Street, Jollibee is betting that global taste and investor appetite, will be on its side.
Helen Cai was appointed senior executive vice president and CFO of Barrick Mining Corporation (NYSE: B), effective March 1, following the departure of long-serving finance chief Graham Shuttleworth, who will be leaving the company after its year-end results. Cai has served on Barrick’s board since November 2021 and brings more than 20 years of experience in equity research, corporate finance, capital markets, and M&A at firms across the mining, industrial, and technology sectors, primarily with Goldman Sachs and China International Capital Corporation.
Meredith Peck was named CFO of Zekelman Industries, the largest independent steel pipe and tube manufacturer in North America. Peck succeeds Mike Graham, who will retire on May 15 following a planned transition period. She brings more than 20 years of financial leadership experience to Zekelman Industries and most recently served as CFO for COTSWORKS, Inc., after earlier roles as the company’s controller and then vice president of finance and administration. Earlier in her career, Peck held senior leadership roles at KeyBank and began her career in public accounting at PwC, and she is also a former U.S. Coast Guard officer.
Big Deal
In a blog post on Sunday, OpenAI CFO Sarah Friar provided an update on the tech giant, including its revenue. In 2023, revenue reached $2 billion in annual recurring revenue; it rose to $6 billion in 2024 and jumped to more than $20 billion in 2025.
This revenue growth closely tracked an expansion in computing capacity. OpenAI’s computing capacity rose from 0.2 gigawatts (GW) in 2023 to 0.6 GW in 2024 and about 1.9 GW in 2025.
Friar writes: “Compute is the scarcest resource in AI. Three years ago, we relied on a single compute provider. Today, we are working with providers across a diversified ecosystem. That shift gives us resilience and, critically, compute certainty.”
In an accompanying LinkedIn post, Friar said that from a finance perspective, demand is real and growing at rates never seen by any company previously, and that customers are paying in proportion to the value delivered. She added that capital is being deployed deliberately into the constraints that actually matter, especially compute.
Going deeper
ACCA (the Association of Chartered Certified Accountants) and IMA (Institute of Management Accountants) have published a Global Economic Conditions Survey, based on the results of their Q4 2025 poll. Members from around the world share their views on the macroeconomic environment.
Confidence among CFOs improved somewhat, but remained below its historic average, and the key indicators point to caution at their firms, according to the findings. Accountants flagged economic pressure, cyber disruption, and geopolitical uncertainty as the top risk priorities, underscoring that risks are increasingly complex and interlinked.
“Accountants remain cautious entering 2026, amid a highly uncertain global backdrop,” Jonathan Ashworth, chief economist of ACCA, said in a statement. “The global economy performed better than expected in 2025 and looks set to remain resilient in 2026 amid recent monetary easing by central banks, stock market gains, supportive fiscal policies in key countries, and the ongoing global AI boom.” However, there remains significant uncertainty, amid a wide range of risks, “not least on the geopolitical front, which are more heavily skewed to the downside,” he said.
Overheard
“We are entering an IPO ‘mega‑cycle’ that we expect will be defined by unprecedented deal volume and IPO sizes.”
—Goldman Sachs’ global co-head of investment banking, Kim Posnett, recently told Fortune. Posnett discussed how she sees the current business environment and the most significant developments in 2026 in terms of AI, the IPO market, and M&A activity. Posnett, named among the leaders on Fortune’s Most Powerful Women list, is one of the bank’s top dealmakers and also serves as vice chair of the Firmwide Client Franchise Committee and as a member of the Management Committee.
Alfia Ilicheva came from the world of public markets, including four years at one of the world’s largest hedge funds, Bridgewater. But when she transitioned over to the private side, including serving as the CEO of an Apollo-backed investment platform, she realized the difficulty of fund administration for operations like private equity and venture capital. Instead of having access to real-time and accurate data like at Bridgewater, which can rely on publicly available information, this new world was filled with manually compiled and fragmented data subject to human error and inconsistent metrics. “How could it be that hedge funds are so into the future and private capital markets are so backward,” she remembers thinking.
As private markets explode and AI makes automation increasingly possible, Ilicheva saw an opportunity to build the next generation of fund administration software for everyone from venture capital outfits to PE giants like Apollo. After initially planning to bootstrap the project, which she named Formulary, Ilicheva was introduced to Hari Arul, a partner at Khosla Ventures, who immediately saw the appeal of the idea. Khosla is leading Formulary’s $4.6 million seed round, which Ilicheva says is three times oversubscribed, with participation from Human Ventures, Serena Williams’s venture firm, and others.
In the red-hot field of private investments, buoyed by the rise of private credit and massively valued companies like SpaceX and OpenAI, fund administration may not be the most alluring area for innovation. But the ability to track investments, returns, and performance—and accurately convey the information to investors, or limited partners—is a necessary foundation.
The existing options fall into two camps: the service side, or high-touch accounting companies, like SS&C and Citco, or the software side, like Carta. As Ilicheva interviewed general partners and former clients in her user research, she realized that nearly everyone was dissatisfied with the existing options to the point that most turned to shadow fund administration, where they would hire outside firms but keep their own books at the same time. “When you raise a fund, your dream is to generate alpha by investing capital, not redoing someone’s work,” Ilicheva said.
Ilicheva planned to find a happy medium between the two models by leveraging AI to massively scale up the service approach, creating software for their own in-house accountants, which Ilicheva playfully calls bionic accountants. “They’re really focused on having a grip on the numbers and delivering service, but they’re not manually entering things in an Excel spreadsheet, which has been the industry’s burden for the past decades,” she said.
The challenge in creating a tech-enabled services company, of course, is scale, with a pure SaaS model able to grow at a much faster clip. When I asked Khosla’s Arul how he thought about the approach, he said the key is to deliver the vast majority of the product through technology: “It’s important for any entrepreneur or any investor to look at an AI-enabled services business and say, the margin of how this business runs looks more like a technology company than a services company.”
Arul said that while Khosla is not yet using Formulary, which is just now coming out of stealth, he’s optimistic for a future where tedious processes like ensuring data accuracy for LPs can be fully, reliably automated. Ilicheva mentioned one possible future use case for Formulary as drafting LP letters, which Arul wholeheartedly endorsed, along with a portal where investors could communicate directly with the system to understand the value of positions, fund deployment, and future capital calls. “[That] sounds pie in the sky relative to what the reality is today,” Arul said, “But it doesn’t feel out of reach.”
In today’s CEO Daily:Fortune‘s AI editor Jeremy Kahn reports on the AI buzz at Davos
The big story: SCOTUS could upend Trump’s leverage to acquire Greenland.
The markets: Jolted by Trump’s renewed tariff threats.
Plus: All the news and watercooler chat from Fortune.
Good morning. I’m on the ground in Davos, Switzerland, for this year’s World Economic Forum. As Diane wrote yesterday, U.S. President Donald Trump’s arrival later this week along with a large delegation of U.S. officials eclipses pretty much every other discussion at Davos this year. But, when people here aren’t talking about Trump, they are talking about AI.
At Davos last year, the hype around AI agents was pierced by the shock of DeepSeek’s R1 model, which was released during the conference. We’ll see if a similar bit of news upends the AI narrative again this year. (There are rumors that DeepSeek is planning to drop another model.) But, barring that, business leaders seem to be less wowed by the hype around AI this year and more concerned with the nitty-gritty of how to implement the technology successfully at scale.
On Monday, Srini Tallapragada, Salesforce’s chief engineering and customer success officer, told me the company is using ‘forward deployed engineers’ to tighten feedback loops between customers and product teams. Salesforce is also offering pre-built agents, workflows, and playbooks to help customers re-engineer their businesses—and avoid getting stuck in “pilot purgatory.”
Meanwhile, at a side event in Davos called A Compass for Europe, that focused on how to restore the continent’s flagging competitiveness, AI was front-and-center. Christina Kosmowski, the CEO of LogicMonitor, told the assembled CEOs that to achieve AI success at scale, companies should take a “top down” approach, with the CEO and leadership identifying the highest value use cases and driving the whole organization to align around achieving them. Neeti Mehta Shukla, the cofounder and chief impact officer at Automation Anywhere, said it was critical to move beyond measuring automation’s impact only through the lens of labor savings. She gave specific customer examples where uplifting data quality, improving customer satisfaction, or moving more workers to new tasks, were better metrics than simply looking at cost per unit output. Finally, Lila Tretikov, head of AI strategy at NEA, said Europe has enough talent and funding to build world-beating AI companies—what it lacks is ambition and willingness to take big bets.
Later, I met with Bastian Nominacher, co-founder and co-CEO of process analytics software platform Celonis. He echoed some of these points, telling me that to achieve ROI with AI generally required three things: strong leadership commitment, the establishment of a center of excellence within the business (this led to an 8x higher return than for companies that didn’t do this!), and finally having enough live data connected to the AI platform.
For further AI insights from Davos, check out Fortune’s Eye on AI newsletter. Meanwhile, Fortune is hosting a number of events in Davos throughout the week. View that lineup here. And my colleagues will be providing more reporting from Davos to CEO Daily and fortune.com throughout the week.—Jeremy Kahn
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Politics8 years ago