Hindenburg Research founder says he’s closing short-selling research shop

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 shared with family, friends and our team since late last year, I have made the decision to shut down Hindenburg Research. The plan has been to wind down after we have finished the pipeline of ideas we were working on .And per the last Ponzi cases we just closed and share with regulators, that day is today,” Anderson wrote in a note posted on the company’s website.

Anderson founded Hindenburg in 2017, and the company 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 was focused on vehicle startup Nikola. Part of the report included an allegation that Nikola had faked a semi-truck’s autonomous capabilities in a video, which the company later admitted. Nikola founder Trevor Milton was later sentenced to four years in prison.

Many of the targets of Hindenburg’s reports were smaller businesses. The firm has also gone after companies of major financial figures, including Carl Icahn Icahn Enterprises LP and Indian billionaire Gautam Adani’s business empire.

The most recent report filed by the company was on January 2 on car dealers Carvanaas it called a “father-son accounts of the ages”. In a statement, Carvana called the company’s report “intentionally misleading and inaccurate.” The stock fell more than 11% the day after Hindenburg released his report, but has since recovered.

Hindenburg was a short-seller as well as a research house. This means that the firm placed bets 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 after the reports were published.

It is not clear how much money Hindenburg made from his short bets.

The rise of the Hindenburg came at a time when the controversial practice of short selling was falling out of favor elsewhere. The meme stock craze of 2021 pitted retail investors against hedge funds, prompting some professional investors to back away from short selling. Federal officials have also investigated other short sellers in recent years, including the Justice Department that hit Citron’s Andrew Left with securities fraud charges last year.