The election clock is ticking down with less than a month left until we vote for our next president. While this campaign cycle has kept Americans on their collective toes, there’s one startup that’s willing to make at least one sure-fire wager on this year’s election – and that’s that you’re willing to bet on who will be sitting in the Oval Office next year.

Meet PredictIt, the company behind an online political betting marketplace that now allows anyone 18 and older to put real money behind their political predictions, including who they think will win the presidential election. The company’s betting contracts are $1, winner take all, with a maximum investment of $850. No funny-money here.

In a way, the platform operates like a stock market for politics. Operating under a “no-action” letter from the U.S. Commodity Futures Trading Commission since it started in 2014, PredictIt allows its members to test their political wits against that of fellow members. Simply put, they make and trade predictions on future events, with real money on the line.

Veteran entrepreneur John Aristotle Phillips was inspired to create the buzzy site after he discovered that people in New Zealand were allowed to legally gamble on U.S. political election predictions, but U.S. citizens didn’t have the same luxury. So, with help from a team of coders, lawyers, financial experts and political professionals scattered across America, he set out to fix the problem.

“I don’t have a formal title,” Phillips said in an interview. “I just help keep it fun and legal.”

PredictIt isn’t the first politics-focused tech startup he’s pioneered. In 1983, Phillips and his brother, Dean, co-founded Aristotle, Inc., a Washington, D.C.-based software firm specializing in mining voter data for high-profile political campaigns. Since its founding, the company has provided custom data solutions for every U.S. president, from Ronald Reagan to Barack Obama. Aristotle also provides much of the back-end predictive tech that powers PredictIt.

With the election nearing the finish line, PredictIt’s servers are working overtime, fielding a steady flurry of prediction share trades from thousands of traders, including more than 100,000 users from the U.S., according to Phillips. Real-life political campaign staffers also flock to the increasingly popular hub aiming to get a jump on early polls.

The predictions PredictIt’s users can bet on include elections in the U.S. and in the United Kingdom, as well as congressional approval ratings and hundreds of political questions. Among the ones available for wager right now: “Will California’s marijuana legalization ballot initiative pass?” “Will Arizona approve minimum wage initiative?” and “Will the GOP keep the Senate?”

Phillips characterizes PredictIt traders as a mixed lot of varied political leanings, most of them in their 20s and 30s.
“[They] may not be more involved in politics than simply being registered to vote for the first time,” he said. On the flip side, he noted, “Others bring a deep knowledge or point of view to their predictions, are highly partisan, and have been involved in politics for decades.”

One question that naturally arises: How accurately does PredictIt – and by extension, its collective of traders – actually predict the outcomes of elections? Columbia University statistics and political science professor Andrew Gelman offered some cautionary advice about taking the site’s betting lines as a benchmark for a candidate’s or ballot initiative’s shot at victory.

“Prediction markets are cool, but you have to be careful not to trust them too far,” he told Free Enterprise. “One issue is that when the stakes are low, interested parties might find it worthwhile to bet strategically in order to influence the betting odds and thus influence public impressions of the forecast.”

Still, there’s some awfully useful insight that one can glean from tracking which way traders think a given election is likely to turn out. PredictIt shares its anonymized trading data at no cost with researchers at 65 universities across the U.S. and at Oxford University in England. Traders, meanwhile, pay a 10 percent fee on profits from selling shares for higher prices than they paid.

In the near future, Phillips plans to open the site to traders outside of the United States. He’d also like to introduce betting teams and leagues, for diehard political junkies.

Oh, and as for who he thinks will occupy the Oval Office – his lips are sealed.

“PredictIt doesn’t take a side,” he said. “It’s the market that speaks.”