OpenAI valuation rises amid shift to for-profit company

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Good morning,

Voters will soon vote to decide which party controls Congress…now they can bet on it, Also.

A federal appeals court on Wednesday overturned a ruling that blocked Americans from betting on the outcome of the congressional election through the Kalshi prediction market. Federal regulators had sought to ban such betting, arguing that it would “threaten the integrity of elections.”

Kalshi is far from the only market for predictions on politics and other topics. In July, Forbes reported that some $446 million was being wagered on the outcome of the presidential election on Polymarket.

Shortly after the court’s decision, 63 percent of bettors on Kalshi’s website predicted Democrats would take the House, while 37 percent said Republicans would be victorious.

FIRST

OpenAI closed a $6.6 billion funding round that valued the booming AI company at $157 billion, almost double the value of the company earlier this year, as it is poised to become a for-profit company. The company said the funding, from Thrive Capital, SoftBank, Nvidia and its longtime backer Microsoft, will go toward its AI research, products and services, and its computing capacity.

Crude oil prices, which strongly influence gas pricesrose again on Wednesday amid heightened concerns about violence in the Middle East. Oil prices remain much cheaper than they were this summer, with international benchmark Brent crude down 14% from its July peak.

BUSINESS + FINANCE

Tesla shares fell Wednesday after it reported third-quarter car deliveries that barely beat analysts’ forecasts, but failed to meet the most optimistic Wall Street’s expectations. Still, quarterly shipment growth of 6% year-over-year is a “small step in the right direction,” Wedbush analyst Dan Ives wrote.

WEALTH + ENTREPRENEURSHIP

IT entrepreneur David Steward, majority owner of World Wide Technology alongside his partner Jim Kavanaugh, is the the richest black person in Americaand is one of four Black members of the 2024 ranking of the richest Americans. Steward initially invested $250,000 in capital to start WWT in 1990, according to a 2019 study. Forbes profile, and went on to snag major corporate clients like Apple, Citi, Microsoft and the federal government.

Former shoe salesman Mitchell Morgan’s company Morgan Properties became the third largest apartment owner in the countryplacing him on the Forbes 400 for the first time with a net worth of $5.5 billion. He gained his success by investing in older apartment buildings in mid-sized cities and quickly renovating them to increase rental income.

TECHNOLOGY + INNOVATION

In a break with some House Democrats, President Joe Biden is expected to sign a bipartisan bill that will limit federal oversight of eligible semiconductor projects in the United States. The legislation addresses concerns that ‘unnecessary delays’ could stifle construction domestic microchip installations.

Drew Crecente’s daughter was murdered 18 years ago, but on Wednesday he discovered someone had created a chatbot using their name and yearbook photo on the Character AI platform. “A grieving father should not have to find out that his deceased daughter is being used to try to make money as a chatbot on a website,” he said. Forbes. Character AI said it has since removed the chatbot from the site for violating its policies.

MONEY + POLITICS

Former President Donald Trump fired his lawyers after the 2020 election and replaced them with Rudy Giuliani because he would ready to “knowingly spread false allegations of electoral fraud” Special counsel Jack Smith alleged in a filing Trump’s efforts to overturn the election. Trump campaign spokesman Steven Cheung denounced Smith’s filing as “disingenuous” and “unconstitutional.”

New York City Mayor Eric Adams will “likely” face additional charges, prosecutors announced Wednesday, less than a week away. after being indicted on federal bribery and fraud charges. Adams, who appeared at a hearing in Manhattan federal court Wednesday, pleaded not guilty to all charges.

A federal judge has suspended a new California state law that cracked down on use of AI-generated deepfakes targeting political candidatesweeks after the creator of an AI-altered campaign video mocking Vice President Kamala Harris filed a lawsuit to block the legislation. In his ruling, the judge wrote that while fear of deepfakes may be justified, the law likely violates the First Amendment.

TRENDS + EXPLANERS

President Joe Biden ordered 1,000 active-duty troops to help provide food, water and other services to affected communities by Hurricane Helene, which decimated the South this weekend. At least 175 people have died, hundreds are still missing and around 1.3 million people were still without power as of Wednesday afternoon.

MORE: The IRS will give individuals and businesses affected by the storm more time to file and pay their taxes, including in Alabama, Georgia, North Carolina and South Carolina, as well as parts of Florida, Tennessee and Virginia. These taxpayers now have until May 1, 2025and for the most part, you shouldn’t have to do anything to get relief.

DAILY COVER STORY

This American company is profiting from the war in Ukraine with killer drones that fit in a backpack

TOP LINE The deadly Switchblade is at the heart of the ambitions of AeroVironment CEO, Wahid Nawabi turning the drone maker into a multibillion-dollar company over the next three to five years, up from $717 million in revenue in its 2024 fiscal year.

Switchblade is a wandering munition, an expensive type of one-way kamikaze drone designed to circle the battlefield, waiting for a good opportunity to annihilate its target. The Russians and Ukrainians are using them in a war where dense networks of anti-aircraft systems have relegated fighter planes and bombers to the margins.

Starting in 2022, the United States has supplied Ukraine with 700 Switchblade 300s, a $50,000 missile small enough to be carried in a soldier’s backpack and launched with minimal cost. effort. It has been quietly used by US special forces in Iraq and Afghanistan over the past decade to eliminate “high value” insurgents from up to 6 miles away.

THE The war in Ukraine is a buzzing laboratory for unmanned aircraft, where creators test and improve their designs. AeroVironment got off to a rocky start in the face of Russian electronic warfare, which reportedly hampered many sophisticated Western drones, but the company now appears to be one of the winners. (Nawabi claims that modifications to overcome jamming and better training have pushed Switchblade’s effectiveness rate north of 80%.)

Many companies are pursuing this opportunity: a study last year by the Vertical Flight Society counted 123 entities in 32 countries that were producing unidirectional attack drones. But AeroVironment, which has quietly been the Department of Defense’s primary supplier of small drones for the past two decades, may have the relationships, technology and industrial experience to better satisfy the U.S. military’s sudden desire to have mass availability of unmanned systems.

WHY IT IS IMPORTANT “The conflict in Ukraine has changed the way war is fought, and countries around the world are rushing to acquire stray munitions,” says Forbes editor-in-chief Jeremy Bogaisky. “AeroVironment appears ready to meet demand from the U.S. military and its allies.”

MORE The US military uses laser weapons in combat

FACTS + COMMENTS

A new study finds that students who get short phone breaks during class perform better on tests and use their phones less during class. The discoveries come in the middle of debate on the use of cell phones and its impacts on student success:

One minute: Participants given a one-minute phone break had the highest test scores and used their phones less during class.

“The shorter the better”: The one-minute technology break was more effective than two or four minutes

About 72%: The share of U.S. high school teachers who say phone distractions are a “major problem” during class, according to Pew Research.

STRATEGY + SUCCESS

Are you dealing with a micromanager in your workplace? Whether it’s your boss or not, there are psychologically-backed techniques to reduce scrutiny and interference from someone with excessive control: Try to strengthen your shared identity With the person, it can be as simple as using language like “we” and “our” when discussing goals. And focus on being proactive, for example by offering regular updates before the micromanager has a chance to request it.

VIDEO

QUIZ

A regional airport closed Wednesday after an unexploded bomb, likely dropped by the United States during World War II, exploded under the taxiway, canceling dozens of flights but fortunately causing no injuries. Where did this happen?

A. Germany

B. Japan

C. Poland

D.LI

Check your answer.

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Thanks for reading! This edition of Forbes Daily was edited by Sarah Whitmire and Chris Dobstaff.