Nathan Anderson is teaser by Elon Musk (and other tech boboers)

Short sellers are ‘value destroyers’ and their practices should be banned. Was signed, Elon Musk, 2018, in one of his many tirades against investors speculating in a fall in corporate prices. Not infrequently, they turn their attention to Tesla, Musk’s manufacturer of electric cars.

While Tesla is working hard to beat its own record year 2021 in the stock market, things did not go so smoothly with Twitter at the beginning of this year. Since Musk announced last month that he would buy the company, Twitter has once again made modest profits. Good news for investors, one might say, but master investor Nathan Anderson (pictured below) is not cheering. In fact, he goes short on Twitter.

Go short on Twitter

Nathan Andersen
Nathan Andersen.

According to Anderson’s infamous company Hindenburg Research, Twitter’s stock could fall in value by as much as 50 percent if Musk decides to abandon the deal or if he manages to negotiate a lower price for his acquisition.

Musk and a group of investors pay $ 44 billion for social media, which Hindenburg says is way too much. The company points out in a press release that tech stock Nasdaq has fallen by as much as 17 percent in the meantime.

Twitter seems to have exaggerated its user base for years and Musk would go into serious debt for the deal. Anderson and his team expect Musk to eventually pay a $ 1 billion fine for avoiding burning his fingers on Twitter.

He will then sell Musk’s current 9 percent of the shares in Twitter, the short seller expects. And then Musk has a new enemy.

Nathan Anderson as a financial activist

The enemy, Nathan Anderson, is regularly described by the media as an activist outsider in the financial sector. The Connecticut-educated speech analyst may have received the critical spirit from his father, a university professor. Anderson taught the finance industry while doing business at the University of Connecticut, a home game, but also spent some time studying in Israel.

His great passion, the father of a daughter told The New York Times last summer, is finding “scams.” Anderson’s first job was as a consultant for a financial analyst and as a deal-breaker for an investor.

Discovering scams was my secondary hobby

In his spare time, however, Anderson was busy solving all sorts of ponzi scam cases with hedge funds – a kind of pyramid scheme for investors. “It was a side hobby that sometimes annoyed my employers,” he said.

Nathan Anderson was almost thrown out of his house

In 2015, Anderson quit his job in an investment fund to start his own company. With the startup ClaritySpring wanted Anderson due diligenceservices make the world of hedge funds more transparent.

At least that was the idea, because it all turned into a little. In fact, so little that Anderson was barely thrown out of his apartment by his landlord. Anderson decided in 2017 to sell the tent and start the financial analysis company Hindenburg, a company he named – somewhat eerie – after a German zeppelin that was destroyed by a fire in 1937.

Black trade in gaming houses

Hindenburg proved to be a bull’s eye. The company has already successfully shorted the online gambling company DraftKings, which had gone public through one acquisition company for special purposes (spac), an empty scrotum. The company may be in black trade, Hindenburg said, after which DraftKings was sued by the U.S. stock watchdog SEC.

Among other things, Anderson repeated this trick at a Chinese blockchain company. In Hindenburg’s eyes, this company had made incorrect allegations about its business operations.

Hindenburg revealed the Nikola scandal

Anderson has had the greatest success so far with his critique of Nikola, the maker of electric trucks. Hindenburg revealed that the company rolled a non-functioning e-truck down a mountain to trick investors into believing the vehicle was working.

These and several similar revelations forced Nikola to settle with the SEC for $ 125 million at the end of last year. Anderson’s company went short on a price drop. That was actually the case: Nikola’s market capitalization fell by 40 percent.

Small team from Hindenburg Research

And to think that Anderson can handle this with only a handful of people. Last summer, during the investor’s interview with The New York Times, the newspaper reported on a five-man team.

Anderson works primarily with former journalists and analysts, who are given six months to work on a report. During that time, they dig into publicly available documents and talk to current and former employees of the companies they are investigating.

Musk: do not forget to look on the bright side sometimes

Whether Musk feels in the corner of Anderson is still unknown. Tesla founder responded via ‘he’ Twitter account slightly annoyed but musically-minded over the report: ‘Interesting. Do not forget to look on the bright side sometimes! ‘

also read: Hedge Fund Billionaire Ray Dalio: How to Build a Radically Transparent Organization

Leave a Comment