OpenAI Nearly Doubles Its Valuation. Turning For-Profit May Be Harder
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OpenAI nearly doubled its valuation, but turning it into a real business may prove complex. And how the devastation from Hurricane Helene scrambles the calculus for the Harris and Trump campaigns. There's a lot of danger there because people who are hurting and who have lost their homes, they don't really want to hear a blame game. They just want help.

Plus, why an archipelago high above the Arctic Circle is emerging as a potential military theater for Russia, China and NATO. It's Wednesday, October 2nd. I'm Tracy Hunt for The Wall Street Journal. This is a PM edition of What's News, the top headlines and business stories that move the world today.

OpenAI has raised $6.6 billion in new funding, capping a complex fundraising process that involved multiple tech giants and overseas investors, as well as renewed scrutiny of the company's internal turmoil. Investors are valuing the startup behind ChatGPT at $157 billion. This puts it on par with the market capitalizations of publicly traded household names like Goldman Sachs, Uber, and AT&T.

Investors in the new round will have the right to withdraw their money if OpenAI doesn't complete its planned conversion to a for-profit company. The move to becoming for-profit is meant to simplify the world's leading artificial intelligence startup. But as our reporter Teo Francis told our Tech News Briefing podcast...

Making that happen will be enormously complex. What's involved in this conversion is nonprofit law. Fundamentally, charities are not owned and controlled by the people who set them up or even really the people who donate money to them. They are independent entities and they have an obligation to society under law. Essentially, what goes into a nonprofit can't be taken out for anyone's gain. And that would include investors in this new entity.

So right now, OpenAI, the nonprofit, owns, has control over the for-profit. The charity can't end up at the end of this process with less than it has now in terms of value. And

investors might be willing to plow a certain amount of money into the for-profit that might imply a certain valuation. But what the charity gets fundamentally has to keep it whole or maybe even make it a little better off. It can't leave it worse off financially.

And just a quick note, News Corp, the owner of The Wall Street Journal, has a content licensing partnership with OpenAI. And you can hear more about how OpenAI's plans may play out in our tech news briefing podcast. Jamie Dimon, the chairman and CEO of JPMorgan Chase, has a plan to help some of America's poorest communities build more branches in their towns and cities. The bank is opening around 100 new Chase locations in rural and low-income areas.

After piloting the model five years ago, JPMorgan is now expanding it nationwide. Alexander Saidi covers banking and finance for The Wall Street Journal, and he joins us now. Alex, what does Jamie Dimon hope to accomplish with this plan?

The strategy is to expand Chase into low and moderate income areas where banks have been reducing their footprint over the last 15 years. They identify a real commercial opportunity, which is to increase the number of people with bank accounts,

reach out to folks and help them understand how they can start small businesses, get mortgages, and plan their financial future. And the way they're doing that is through this community center model. And the idea is bring people in, not to sell them products, but to first educate them. Even if you're not a Chase customer, you can come in, learn how to build a budget, plan for your future, save for college, whatever it may be. And then...

If you've got people in there and they're looking for help and tools to achieve their goals, Chase is right there to help you get a bank account, etc. And why are these banks actually needed in these communities?

There are parts of the country where over 5%, 10% of the communities are unbanked, don't have bank accounts. They're using check cashers, payday lenders to get cash, and they're paying a lot of money and fees to do so. And that is money that could otherwise be in their pocket. So I think they just want to get in there, offer these people things that are better for them than some of the non-bank alternatives that

in these communities. And this is not just in inner cities, but also in like rural towns. And it's to help them. And then it's also just to help Chase kind of grow. They're the biggest bank in the country. They want to get even bigger. So this is another way to help them do that. Alexander Saidi is a reporter covering banking and finance for The Wall Street Journal.

Markets calmed down today as investors' focus turned, at least temporarily, back to the U.S. economy from an increasingly volatile conflict in the Middle East. Stocks edged higher. All three major U.S. indexes added 0.1 percent or less, with the Dow up 40 points.

Coming up, how the escalating Middle East conflict, Hurricane Helene, and the porch strike have thrown a curveball for the 2024 presidential campaigns. That's after the break.

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Hurricane Helene has injected fresh uncertainty into the presidential race in a week that also saw a dockworker strike that could tank the U.S. economy. President Biden and Vice President Kamala Harris are visiting two crucial swing states that have been affected. And Donald Trump made his own visit to Georgia on Monday. That all poses potential risk and opportunities for the campaigns of both candidates.

Joining us now to discuss all this is Annie Linsky, a White House reporter for The Wall Street Journal. So Annie...

How is the Biden administration's response to these crises crucial for Harris? This is the beginning of October, and there are multiple crises that the White House is facing right now. And Harris is in a tricky position here. She's not the president. She's not calling the shots. But on the campaign trail, she is very much going to be held responsible for how Biden and his team respond.

So what are the risks of injecting politics into a disaster like this? So far, Trump is the only one to inject politics here. He showed up on Monday in Georgia and he was saying this is a terrible tragedy. Our hearts go out to those who are impacted. But then he also said that the federal government, the Biden administration isn't doing enough and then made this claim that Trump

Joe Biden had not spoken with Georgia Governor Brian Kemp, which Governor Kemp immediately disputed. And the strategists that I talked to say there's a lot of danger there because people who are hurting and who've lost their homes, they don't really want to hear a blame game. They just want help.

But look, if this drags on and people do not have power for days and days and days, and that's where the blame begins to shift and people want somebody to be angry at. And that's where I think Harris has some risk. The dock workers strike is also a challenge for both Harris and Trump.

with both nominees trying to appeal to union voters. What are the opportunities here for either candidate? Dock workers are striking on the East Coast.

And the longer this lasts, the harder it becomes for the White House and the bit more political damage that Harris faces. Now, one thing that is really interesting about this strike is both Harris and Trump are both saying things that are quite supportive of the strikers. And that's unusual. So in this instance, there's sort of an extraordinary political pressure that's

redounding to the benefit of the workers in this case. But the longer this drags on, the greater the political risk for Harris. So what kind of curveballs does an escalating conflict between Israel and Iran bring to all of this right now? Foreign policy is not typically an important issue in an election.

But the world is coming up on the anniversary of the horrific, horrific October 7th attacks on Israel. And I think that if you're seeing an escalation in the Middle East, that is something that the Biden administration has worked very hard to avoid and that the Harris team has got to hope that this is a problem that the Biden folks can contain. Annie Linsky is a White House reporter for The Wall Street Journal.

Americans are having fewer babies and it's become a campaign issue. What questions do you have about what our falling birth rate means for the way we live, how our economy grows, and for America standing in the world? Send a voice memo to WNPOD at WSJ.com or leave a voicemail with your name and location at 212-416-4328. We might use it on the show. ♪

Nestled high above the Arctic Circle, the Norwegian archipelago of Svalbard is home to fewer than 3,000 people and hundreds of polar bears. But now the territory is emerging as a front line in Russia and China's attempts to dominate the Arctic's trade routes and expand their military presence in the region at the expense of the West.

My colleague, Anthony Bansi, spoke to our foreign correspondent based in Berlin, Georgi Kanchev, and asked him what the Russian and Chinese presence on the archipelago looks like. Russia, they've been mining coal, and that has been the main reason they were there. China has their own research station far in the north of that archipelago. So that's their current presence. But of course, given the...

Current geopolitical tensions with the West, those two countries want to expand their presence, strengthen their foothold in the Arctic, and Svalbard is a strategically located place that Moscow and Beijing want to use to increase their presence in the Arctic. What kind of role would Svalbard and the Arctic play

broadly play in a greater power conflict? In a greater power conflict, this becomes one of the crucial maritime gaps, two fairs, both for the Russians and for the West.

Svalbard is becoming the crucial gap that is being looked at both by NATO and by Moscow as well, because that's where the West would want to come through and Russia would also want to barricade that route potentially. So really the bear gap and Svalbard, which is the top of that route, becomes a very important part of that potential military theater. And both sides, NATO, Norway, and Russia are preparing for a potential military confrontation.

That was our foreign correspondent, Georgi Kanchov, speaking to my colleague, Anthony Bansi. And that's what's news for this Wednesday afternoon. Today's show was produced by Anthony Bansi and Pierre Bien-Aimé with supervising producer Michael Cosmitas. I'm Tracy Hunt for The Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening. ♪

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