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, the fledgling research and investment firm that made a name for itself with several successful short bets, is closing, founder Nate Anderson announced Wednesday.
“As I’ve shared with family, friends and our team since late last year, I’ve made the decision to disband Hindenburg Research. The plan was to close after we’ve completed a number of ideas we’ve been working on. And since the last Ponzi cases we’ve just completed and we’re sharing them with regulators, that day is today,” Anderson wrote in note published on 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 appeared in 2020 and focused on him starting the Nikola vehicle. Part of the report included the claim that Nikola faked the semi truck’s autonomous capabilities in the video, which he the company later admitted. Nikola’s founder Trevor Milton was later sentenced to four years in prison.
Many of the targets of the Hindenburg reports were smaller companies. The company also went after the company main financial figuresincluding Carl Icahn Icahn Enterprises LP and the business empire of Indian billionaire Gautam Adani.
The last report the company filed was on Jan. 2 about the auto dealer Carvanwhich he called “father-son”. accounting fraud forever.” In a statement, Carvana called the company’s report “deliberately misleading and inaccurate.” Shares fell more than 11% the day after Hindenburg released his report, but have since recovered.
Hindenburg was a short-seller as well as a research house. That means the firm was betting against the companies it was researching, putting it in a position to profit if the stock fell. As Hindenburg’s reputation grew, some stocks experienced immediate negative reactions following the release of the report.
It is not clear how much Hindenburg made on his short bets.
Hindenburg’s rise came at a time when the controversial practice of short-selling was out of favor elsewhere. The craze for meme stocks in 2021 has pitted traders against hedge funds, causing some professional investors to abandon short selling. Federal officials have also investigated other discounters in recent years, including the Justice Department, which cracked down on Citron’s Andrija Lijevo with securities fraud charges last year.
