Nate Anderson on January 6, 2023 in New York. Anderson exposes corporate fraud and ponzi schemes through his company Hindenburg Research.
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Hindenburg Research, an upstart research and investment firm that made a name for itself with several successful short bets, is closing, founder Nate Anderson announced Wednesday.
“As I have been sharing with family, friends and our team since late last year, I have decided to shelve the Hindenburg Inquiry. The plan was to end after we finished the line of ideas we were working on. the last Ponzi cases we have just completed and are sharing with regulators, that day is today,” Anderson wrote in his note posted to the company's website.
Anderson founded Hindenburg in 2017, and the firm has published negative research reports on dozens of companies in the years since. One of Hindenburg's first high-profile reports came in 2020 and focused on Nikola starter car. Part of the report included an allegation that Nikola had disputed the semi-truck's autonomous capabilities in a video, which the the company later admitted. Nikola founder Trevor Milton has been sentenced again four years in prison.
Many of the targets in the Hindenburg reports were smaller companies. The company has also gone after companies from big financial figuresincluding Carl Icahn's Icahn Enterprises LP and the business empire of Indian billionaire Gautam Adani.
The most recent report the company filed on January 2 was about a car dealer Caravanwhom he called “father-son great accounting for the ages.” In a statement, Carvana called the company's report “deliberately false and inaccurate.” The stock fell more than 11% the day after Hindenburg released its report but has since recovered.
Hindenburg was a short seller as well as a research house. This means that the company was betting on the companies they were researching, putting them in a position to profit if the stock went down. As Hindenburg's reputation grew, some stocks saw immediate negative reactions after the reports were published.
It is not clear how much money Hindenburg made from his short bets.
Hindenburg's rise came at a time when the controversial practice of short selling was falling out of favor elsewhere. The meme-stock crash of 2021 pitted retail investors against hedge funds, causing some professional investors to back away from short selling. Federal officials have also been investigating other short sellers in recent years, including the Justice Department's crackdown on Citron's Andy left with securities fraud charges Last year.
