Investing.com -- Polymarket on Tuesday launched prediction markets tied to private company performance through a partnership with Nasdaq Private Market, marking the first such offering in the sector.

The new markets will allow users to trade on outcomes related to private company milestones, including valuations, IPO timing and secondary market activity. Nasdaq Private Market will provide resolution data for these markets.

Prediction markets enable users to trade on future event outcomes, with prices reflecting perceived probabilities of those outcomes. The sector has expanded as users trade on events from elections to cryptocurrencies.

Polymarket said the offering creates an additional price discovery tool for institutional investors. The launch comes as companies remain private for extended periods, with several startups reaching valuations comparable to S&P 500 companies.

Nearly 1,600 unicorns globally, or startups valued at more than $1 billion, now account for over $5 trillion in cumulative value, according to Polymarket. This has drawn increased investor interest in private markets.