Should I Gamble On Music? A Conversation with Caleb Davies
Some people bet on sports. Others bet on music.
A few weeks ago, I wrote about how pop music was becoming a sport. Some of this transformation was related to the language fans used to describe their favorite artists. Other pieces were connected to new-ish betting markets, like Kalshi and Polymarket, that allow you to gamble on basically anything, music included. In researching that piece, I gambled a few hundred dollars and netted $1.98. Caleb Davies has made a lot more money than that. Hundreds of thousands of dollars more.
Though he initially made a name for himself betting on politics through PredictIt a decade ago, Davies — who has been featured in the Washington Post, Politico, and Bloomberg — has branched out from politics and made thousands of dollars gambling on music and movies in recent years. We hopped on the phone last week to talk about how he chooses what to bet on, why Rotten Tomatoes is more complicated than Spotify, and if all this gambling is good for society.
Do you make all of your money through betting markets?
Nope. I work in IT. I do make more money betting than I do working, but I still work.
How long have you been active in betting markets?
I started in 2015 with some political bets.
Were you always interested in gambling or did you just think you had knowledge that you could make some money with?
The latter. I was pretty interested in politics for a long time. I’d be on forums where I could discuss it for a long time. Then I saw ads for this thing called PredictIt ,and I thought I’d give it a try. Before that, my only experience gambling was some poker when that was super popular in the 2000s.
Over the last few years, so many betting markets have gone mainstream, the two biggest probably being Polymarket and Kalshi. What have been the biggest changes in this space since you got started a decade ago?
The biggest change is that it’s gone from something you can make a little bit of money with to something you can make a living with. When I started on PredictIt, you could only bet $850 at a time. Because of that, you probably couldn’t make six figures. With Kalshi and Polymarket, you can easily drop $100k in a market.
Though your initial interest was politics, you seem to be quite active in cultural markets these days, meaning music and movies. How did you get involved in those?
Same type of thing. I love music. I love movies. When those markets appeared, it gave me an outlet to make money on things that I love.
Recently, I saw you betting on what would be the top song on Spotify on a given day. Can you give me some insight into how you assess a market and size your bets?
There are several music markets on Kalshi. Originally, they were all connected to Billboard. The way Billboard constructs their charts is kind of opaque unless you want to pay a bunch of money for their data. Spotify markets caught my eye because all of their data is public. It’s completely transparent. Because of that, I can analyze the data and identify trends. It’s like 95% math and 5% your gut.
So, you are building statistical models to find an edge?
Yup. Most days I’m analyzing decay rates of the most popular songs and growth rates of viral ones. I then compare those to historical trends. I also look at proxies for performance. None of them are perfect, but Apple Music and iTunes will also give you some insight into how something is doing on Spotify.
Do you manually place bets or are they handled automatically through an API?
I’m 100% manual. I’ll monitor markets throughout the day and just look for a price that I want. I will use limit orders, so I don’t have to watch things continuously, though. But I’m still the guy pressing buttons to execute trades.
You’re also very active in betting on what score a movie will get on Rotten Tomatoes. Is your process there similar?
It’s similar, but the complexity around Rotten Tomatoes is far greater. Spotify is really just a single data drop every day and then monitoring some proxies. Rotten Tomatoes involves more modeling ahead of time. I have to track when new reviews drop and gauge how they will affect things. It’s just more complicated.
Are those the most complex markets you bet on?
I think so.
It’s clear to me that markets provide utility in some cases. For example, some people claim that betting markets on inflation are more accurate than experts. It’s valuable to have accurate inflation forecasts. But the utility of other markets is not clear to me. Like is there any value by having markets to bet on how songs will chart? Or is it just a way to make money?
I think you’ll hear many defenders of prediction markets claim that they are great sources of information. In many cases, they are. But there are also tons of examples where the information from the market provides little to no value. Like does it matter if “Luther” by Kendrick Lamar is going to top Spotify’s daily chart on April 14, 2025? No. It’s not elections or economics data. It’s just a way to gamble. Nothing more.
Do you need to be adept with mathematical modeling if you want to be successful in these markets? Or is it possible to go off of your gut alone?
To win on a regular basis you need to do some mathematical modeling. There are exceptions. Like when Kendrick dropped a surprise album in November, I knew that was going to number one without crunching any numbers. But, in general, you need to be looking at data.
Over the last few years, gambling markets — especially those around sports — have become very accessible. Everyone is carrying a casino in their pocket. Though I think that people should be able to gamble if they want to, do you think there are downsides to how prevalent gambling has become?
Absolutely. I don't try to fool myself. I've done very well on this stuff, but I don't think the majority of people can control their betting very well. They often lose more than they should be losing. It’s a fairly large problem, and I think it's getting worse with the prevalence of sports betting. It's all over the place. It's so easy for a fun hobby to become a bigger problem. I think it's definitely a societal problem, even though I benefit greatly from it.
Is insider trading a problem in these new markets that have cropped up? Many of these platforms are regulated, but it doesn’t seem they are getting the same level of scrutiny as, say, the stock market.
That’s a good question. I’ve noticed some large orders placed in Spotify markets right before things close. That always gets me wondering if somebody has information on the inside. I don’t think it’s very prevalent, though.
Outside of music, movies, and politics, what are the strangest markets you’ve bet on?
I’m not sure if you remember this, but a few years ago there was this Chinese balloon floating over the U.S. There was a market on if the U.S. would shoot it down. I thought it was hilarious to bet on. I didn’t have any special insight there. I just thought it was funny and jumped on it. That said, I usually just stick to the stuff I’m good at.
Are you involved in sports gambling at all?
A bit, but I shouldn’t be. I’m not very good at it. It is fun, though.
To finish up, what advice would you give to someone who is thinking about gambling money?
Be careful. If you’re playing to win, make sure you have a real edge. Otherwise, you’ll almost certainly lose money.
If it’s just for fun, you still need to be careful. Set limits. Treat it like paid entertainment. But it’s a different animal entirely when you start convincing yourself you can beat any market and start betting like that. That’s where real danger creeps in.
Want more Caleb Davies? Subscribe to his semi-pseudonymous profile on Twitter for more cultural gambling takes.
Want more from Chris Dalla Riva? Pre-order his debut book, Uncharted Territory: What Numbers Tell Us about the Biggest Hit Songs and Ourselves.
fascinating piece. Some of those markets you can bet on are pretty dystopian!
Fascinating indeed. And slightly creepy. . .