Hindenburg Research founder Nate Anderson on Wednesday announced disbanding his US investment research firm. The company created international waves in 2023 after publishing a report accusing Adani Group of “pulling the largest con in corporate history”.
The announcement came as a surprise, as the short-seller was on its path to completing its investigation against some of the biggest corporate moguls worldwide. Then what went wrong? Was it a threat from someone? A health issue? Or another personal issue?
Hindenburg shutdown: Why disband now?
Nate Anderson started Hindenburg in 2017. He also cited the toll of running the firm as “rather intense, and at times, all-encompassing” as the main reason for his decision.
Anderson decided to close his company last year and had already shared the news with his friends, family, and team. While specifying the main reason behind his decision, Anderson wrote, “There is not one specific thing—no particular threat, no health issue, and no big personal issue.”
Hinting at his “desire for relief”, he said that “at a certain point a successful career becomes a selfish act”. The intent behind opening Hindenburg was Anderson’s belief to “prove some things” to himself.
“I have now finally found some comfort with myself, probably for the first time in my life.” Sharing light on the cost of sheer “intensity and focus” to build the firm, Anderson said that he now views “Hindenburg as a chapter” in his life and “not a central thing that defines” him.
Founder Nate Anderson said in his message that the team was winding up the ideas in the pipeline and will now focus on documenting the ways Hindenburg worked.
“The plan has been to wind up after we finished the pipeline of ideas we were working on. And as of the last Ponzi cases we just completed and are sharing with regulators, that day is today,” said Anderson.
What did Hindenburg do?
The US-based investigation research firm engaged in activist short-selling. Its founder, Anderson, used to manage his own company’s money and was a short-seller. This means that he used to bet against companies that might have accounting issues, mismanagement, or fraud, which he used to find usually after a long period of investigation, reported Reuters.
Short-selling involves borrowing a stock to sell it in the expectation the price will fall, then repurchasing the shares and pocketing the difference. Should the price rise, the seller can be exposed to potentially unlimited losses.
Hindenburg accusations against Adani
In 2023, Hindenburg released a report against conglomerate Adani Group that wiped more than $100 billion in value off the group’s shares in a year.
The short-seller accused Adani Group of using offshore tax havens improperly, which the company denied. The report also resulted in scrutiny from Indian stock markets regulator SEBI.
