Trevor Milton Out of Nikola Motors(freightwaves.com)
freightwaves.com
Trevor Milton Out of Nikola Motors
https://www.freightwaves.com/news/breaking-news-trevor-milton-out-of-nikola
67 comments
Same question. I feel either I'm incredibly naive and/or don't get investing at all.
By the former I mean that I believe there are institutional mechanism that stops a company going public and getting serious investments just based on grandiose idea with no backing in what is technically feasible in a specified amount of time. By the latter I point to the fact that institutional investors have splashed serious cash without doing apparently any checks(?)
Also, does anyone remember he promised a new battery with 50% more capacity than current lithium ones?
https://www.forbes.com/sites/alanohnsman/2019/11/24/nikola-m...
I see FT has covered also this side of story:
https://www.ft.com/content/dc4b3e05-bf7c-482c-9241-5296dfb1d...
Just for this promises the owner deserves a "good thrashing".
Also, does anyone remember he promised a new battery with 50% more capacity than current lithium ones?
https://www.forbes.com/sites/alanohnsman/2019/11/24/nikola-m...
I see FT has covered also this side of story:
https://www.ft.com/content/dc4b3e05-bf7c-482c-9241-5296dfb1d...
Just for this promises the owner deserves a "good thrashing".
Anyone apparently can merge with a SPAC (an existing company that is already a listed stock) by basically buying a very weak company. After the merger now you are on the stock market! There's no mechanism of testing the company before the merge, it just happens if they have the money to buy the weaker company.
To be fair, getting listed on the stock exchange before being a billion dollar behemoth should be legal/possible in the first place.
So that more multi-million dollars scams can pop up?
No, so that public investors can participate in growth just like private institutional investors (and rich accredited investors).
Preventing million dollar corporations from going public is an extremely ham-fisted way of policing/preventing scams.
Preventing million dollar corporations from going public is an extremely ham-fisted way of policing/preventing scams.
The fact that this attitude is an easier political sell than the more complex but more fair alternative, is exactly the reason why the rules were changed so you had to already be rich to e.g. be allowed to invest in Facebook before they went public at a $100 billion valuation in 2012.
Imagine, Facebook's valuation was less than $100 million at one point, and people considered it exuberant back then. Factor of 1000 difference even with the IPO valuation. The mind boggles.
Imagine, Facebook's valuation was less than $100 million at one point, and people considered it exuberant back then. Factor of 1000 difference even with the IPO valuation. The mind boggles.
It seems that FOMO always wins over due diligence these days. It's a great time to start a billion-dollar scam.
WeWork.
WeWork was less of a scam and more just highly overvalued. Things like Theranos (and probably Nikola) are actual scams.
At least WeWork didn't need any revolutionary technology to execute its business plan. Theranos depended (and Nikola depends) upon specific technologies -- if the technology isn't there, failure is inevitable.
>At least WeWork didn't need any revolutionary technology to execute its business plan
Just a miracle
Just a miracle
Reminds me of Adam Neumann of weWork. I still think the business model has a lot of merit, especially in post-covid times. Yet, CEO's with self-dealings are always a red flag.
Don't worry guys, gm carefully studied whether they are a real company and everything. Kind of like how they get the ev market and are going to crush tesla and make an attractive and successful business selling evs.
I understand the deal was structured quite a bit in GMs favor.
IMHO it's very possible Nikola could become GMs EV brand, similar to Polestar for Volvo. And now with GM representative being the new chairman, it's looking more like it.
IMHO it's very possible Nikola could become GMs EV brand, similar to Polestar for Volvo. And now with GM representative being the new chairman, it's looking more like it.
That requires Nikola to either have a valuable brand, or valuable technology.
It's not clear that the former is true, and it's pretty clear that the latter is not.
It's not clear that the former is true, and it's pretty clear that the latter is not.
[deleted]
> Sources close to the embattled fuel cell truck manufacturer are reporting that founder Trevor Milton has resigned as Executive Chairman of Nikola Motors (NASDAQ: NKLA) and has departed the company effective immediately
Wow. I wonder if he "resigned" or jumped ship. Either way, it doesn't look good.
Theranos 2.0?
Wow. I wonder if he "resigned" or jumped ship. Either way, it doesn't look good.
Theranos 2.0?
Very excited to see how this is going to be held up as a failure of tech.
I'm very excited for another audiobook about a tech startup scam to listen to on a future road trip. On that note, Bad Blood in audiobook form is excellent for that purpose.
The Financial Times has had daily coverage of this in a great series of articles. Unfortunately paywalled.
https://www.ft.com/search?q=nikola
https://www.ft.com/search?q=nikola
From his Wikipedia page:
> In September 2020, two days after Nikola established ties with General Motors, short seller Hindenburg Research released a report accusing Milton of making false statements and characterizing Nikola Motor Company as "an intricate fraud" over many years.[4] Nikola stock fell by 8 percent that day, and fell an additional 15 percent the following day after Milton failed to deliver his rebuttal as he previously promised on Twitter.[8][9][10] Further verification by Bloomberg and Financial Times confirmed some of the details presented in the report.[11][12] As of September 12, 2020, Nikola Motor Company was being investigated with regard to a shareholder lawsuit by at least one law firm for possible fraud as detailed in the report from short seller Hindenberg (most of which referred to statements and actions by Milton). [13] On September 14, Bloomberg, the Financial Times, and the Wall Street Journal all reported that the US Department of Justice joined the SEC in the investigation related to potential securities fraud.
https://en.wikipedia.org/wiki/Trevor_Milton
> In September 2020, two days after Nikola established ties with General Motors, short seller Hindenburg Research released a report accusing Milton of making false statements and characterizing Nikola Motor Company as "an intricate fraud" over many years.[4] Nikola stock fell by 8 percent that day, and fell an additional 15 percent the following day after Milton failed to deliver his rebuttal as he previously promised on Twitter.[8][9][10] Further verification by Bloomberg and Financial Times confirmed some of the details presented in the report.[11][12] As of September 12, 2020, Nikola Motor Company was being investigated with regard to a shareholder lawsuit by at least one law firm for possible fraud as detailed in the report from short seller Hindenberg (most of which referred to statements and actions by Milton). [13] On September 14, Bloomberg, the Financial Times, and the Wall Street Journal all reported that the US Department of Justice joined the SEC in the investigation related to potential securities fraud.
https://en.wikipedia.org/wiki/Trevor_Milton
What a phenomenally quick fall from grace.
I'm actually surprised how much the stock is still worth. It looks[0] like they're still worth more than when they went public in June.
Btw: when the Hindenburg report was published, it was also discussed on hn[1]
[0]https://finance.yahoo.com/quote/NKLA/
[1]https://news.ycombinator.com/item?id=24436721
Btw: when the Hindenburg report was published, it was also discussed on hn[1]
[0]https://finance.yahoo.com/quote/NKLA/
[1]https://news.ycombinator.com/item?id=24436721
What a scam. I wonder what this does to market confidence. Yet another sign that we are getting really close to a crash.
You realize this is exactly how short sellers in the market are supposed to operate, right? It will give everyone confidence the market is operating correctly.
Disagree. This is yet another sign that there’s enough shenanigans happening in the market. If something this blatant can happen in the wide open imagine what other companies are hiding in the dark.
1st-person video of Milton jogging next to one of the vehicles:
https://www.youtube.com/watch?v=7LSrvRMgIqw
https://www.youtube.com/watch?v=7LSrvRMgIqw
This video is from July of 2020, and at this time I don't doubt that they have a semi-truck chassis with a fuel cell drivetrain in it. However, whether this truck performs even close to the specifications and capabilities of what Nikola claims is never substantiated.
Fuel cell vehicles have been around for a long time, and I presume it's not that difficult to put a basic prototype together with amount of capital available to Nikola.
Fuel cell vehicles have been around for a long time, and I presume it's not that difficult to put a basic prototype together with amount of capital available to Nikola.
How legitimate is freightwaves.com ? No one else is reporting this news
Very legitimate in the trucking industry
Very legitimate
The whole thing is such a transparent scam, you could almost use it as a litmus test to distinguish the fools from those who actually have a functioning brain.
yeah, to me the name alone was such a red flag. i didn’t think anyone would fall for such a comically obvious attempt to ride tesla’s coattails, without a product or a ceo with any semblance of technical knowledge. sadly i was wrong.
This. Couldn't agree more.
This so much. He did it out in the open and admitted repeatedly that everything is outsourced. I mean anyone with a million or two can put together a hydrogen fuel cell truck that “runs”. No science/engineering background or even passing interest in learning the tech he sells.
The only company fully vertically integrted from the beginning and outsourced literally everything at the same time.
Heard his podcast few weeks back, he was very confident about technology and business model. It is surprising to see him resign, Jump ship or pushed out by board members.
Their business model would make money even if they started the fleet with gas powered trucks, doing it with self manufacturered hydrogen powered vehicle is the major doubt at this point perhaps.
Their business model would make money even if they started the fleet with gas powered trucks, doing it with self manufacturered hydrogen powered vehicle is the major doubt at this point perhaps.
> he was very confident about technology
That might help if he actually knew anything about technology though...
> "The entire infotainment system is a HTML 5 super computer," Milton said. "That's the standard language for computer programmers around the world, so using it let's us build our own chips. And HTML 5 is very secure. Every component is linked on the data network, all speaking the same language. It's not a bunch of separate systems that somehow still manage to communicate."
That might help if he actually knew anything about technology though...
> "The entire infotainment system is a HTML 5 super computer," Milton said. "That's the standard language for computer programmers around the world, so using it let's us build our own chips. And HTML 5 is very secure. Every component is linked on the data network, all speaking the same language. It's not a bunch of separate systems that somehow still manage to communicate."
I like how this quote says "a HTML" and uses let's wrong too. Seems like whoever transcribed it did a poor job.
Perhaps they use HTML documents as message format. Some kind of SOAP, but with HTML5 tables and semantic instead of XML.
Perhaps the guy didn't really understand the things he was supposed to explain.
Perhaps the guy didn't really understand the things he was supposed to explain.
>> he was very confident about technology
> That might help if he actually knew anything about technology though...
Or maybe that would make him less confident! :)
> That might help if he actually knew anything about technology though...
Or maybe that would make him less confident! :)
What the, can you provide a source for that cause wow
> he was very confident about technology and business model
That's his whole stick. He is a bullshit artists, his whole job is to sound confident and sell bullshit.
> Their business model would make money even if they started the fleet with gas powered trucks, doing it with self manufacturered hydrogen powered vehicle is the major doubt at this point perhaps.
So they buy trucks and then resell them with the Nikola brand? How would that make them a good buissness.
Hydorgen trucks will not be out for many years, Toyota and Daimlre can do it, sure as hell Nikola couldn't.
And by 2025 when people talk about hydrogen trucks battery tech already made those designs totally uncompetitive.
That's his whole stick. He is a bullshit artists, his whole job is to sound confident and sell bullshit.
> Their business model would make money even if they started the fleet with gas powered trucks, doing it with self manufacturered hydrogen powered vehicle is the major doubt at this point perhaps.
So they buy trucks and then resell them with the Nikola brand? How would that make them a good buissness.
Hydorgen trucks will not be out for many years, Toyota and Daimlre can do it, sure as hell Nikola couldn't.
And by 2025 when people talk about hydrogen trucks battery tech already made those designs totally uncompetitive.
“Their business model would make money even if they started the fleet with gas powered trucks”
Here, I have this nice bridge, would you like to buy it, perhaps via a SPAC?
Their business model seemed to be centered around building out a hydrogen fueling station network, which is phenomenally complicated. Tesla built out an electric charger network, but that was not particularly technically challenging. Lots of legwork to work with local zoning and businesses, sure, but it’s still just fancy chargers on the electric grid. Building out a giant system to produce hydrogen and safely fill vehicles with it? Again, I have a nice bridge here for sale.
Here, I have this nice bridge, would you like to buy it, perhaps via a SPAC?
Their business model seemed to be centered around building out a hydrogen fueling station network, which is phenomenally complicated. Tesla built out an electric charger network, but that was not particularly technically challenging. Lots of legwork to work with local zoning and businesses, sure, but it’s still just fancy chargers on the electric grid. Building out a giant system to produce hydrogen and safely fill vehicles with it? Again, I have a nice bridge here for sale.
I think you grossly underestimate the difficulty of designing and building a new line of automobiles from scratch.
Cant wait for the Netflix documentary.
I'm shocked to see no mention of the tweets by David Bateman that seem to have set this off https://twitter.com/davidbateman/status/1307212066017521667?...
Did you link the wrong tweet? The one you linked (https://twitter.com/davidbateman/status/1307212066017521667?...) seems to be some douchy DMs where he tried to get a girl to hook up with some random guy in Vegas. But that doesn't seem to have anything to do with the financial state of his company or lying about products?
That's the right tweet thread. It seems there are other allegations at Trevor that might be the reason he's stepping down. The thread is allegations that he entrapped a long time, mentally ill, ex-friend in an extortion case to put him in jail. The reason? Because the ex-friend was posting texts of Trevor attempting to prostitute women.
His resignation post[0] includes "I intend to defend myself against false allegations" so most likely the resignation reason is not the company, but personal allegations. Apparently there is a NYT article incoming.
[0] https://twitter.com/nikolatrevor/status/1307927801966866438
His resignation post[0] includes "I intend to defend myself against false allegations" so most likely the resignation reason is not the company, but personal allegations. Apparently there is a NYT article incoming.
[0] https://twitter.com/nikolatrevor/status/1307927801966866438
Damn, that was their only paying customer [1].
[1] https://www.businessinsider.com/nikola-earnings-only-revenue...
[1] https://www.businessinsider.com/nikola-earnings-only-revenue...
CNBC Melissa Lee really dug into him about adding a solar roof to his Utah personal home[1] and claiming it as revenue (100% actually) of Nikola.
[1] https://www.youtube.com/watch?v=my08ZINPgx8&ab_channel=CNBCT...
[1] https://www.youtube.com/watch?v=my08ZINPgx8&ab_channel=CNBCT...
Related, apparently he claimed in an interview that the company HQ had a large (3 MW) solar installation, and it hasn't. Why lie about something so inconsequential that anyone can find out is false by looking at it?
Because when the entire firm is a house of cards, with one lie after another, adding another little lie won't change anything. I doubt he can even keep track of what he lies about.
I can't help but think about this clip whenever I hear that the CEO was their only customer
https://www.youtube.com/watch?v=P5elYqy0gaU
https://www.youtube.com/watch?v=P5elYqy0gaU
I was waiting for the "HTML 5 super computer" Trevor touted...too bad.
How is the stock still at $34?
These tech scammers out do themselves year after year.
Surprising nobody.
As somebody following EV, I always considered them a joke company. But then the IPO and all of a suddend were mentioned as a major competitor just on the heels of Tesla. It was insane.
Literally listening to Trever Milton for 5min makes it clear that he was a major bullshit artist. I don't know how people didn't see that. Pretty much nothing he said made sense or was consistant.
As somebody following EV, I always considered them a joke company. But then the IPO and all of a suddend were mentioned as a major competitor just on the heels of Tesla. It was insane.
Literally listening to Trever Milton for 5min makes it clear that he was a major bullshit artist. I don't know how people didn't see that. Pretty much nothing he said made sense or was consistant.
Additional details from the NYT:
https://www.nytimes.com/2020/09/21/business/nikola-trevor-mi...
Mr. Milton said in a statement that “the focus should be on the company and its world-changing mission, not me. So I made the difficult decision to approach the board and volunteer to step aside.”
Mr. Milton said in a statement that “the focus should be on the company and its world-changing mission, not me. So I made the difficult decision to approach the board and volunteer to step aside.”
…did it not trip anyone’s early-warning sensors that they named their company Nikola, so that they could piggyback on Tesla’s name recognition?
I found the subreddit [1] a really interesting (and confusing) read on the company. I went through it after the Hindenburg report, and as an outsider I'm just really baffled on people's absolute devotion to the company (and Milton). Even so far as to say the SEC investigation was a good thing because they asked for it themselves and it will clear them of all wrong-doing.
All of this reminds me that I think too logically as an engineer. There are a lot of people out there who don't think the same way and there's a lot to learn in understanding how they view things.
[1] - https://www.reddit.com/r/NikolaCorporation
All of this reminds me that I think too logically as an engineer. There are a lot of people out there who don't think the same way and there's a lot to learn in understanding how they view things.
[1] - https://www.reddit.com/r/NikolaCorporation
Every startup has some cheerleaders who don't care too much about reality. While a company is private, you're only allowed to invest if you are a cheerleader, and you're invited to leave if you become too critical.
It's great to have a vision, but dangerous to confuse the vision with reality.
It's great to have a vision, but dangerous to confuse the vision with reality.
Oof. And he still owns 20% of a company created via SPAC.
How does any of this work? How has this passed any diligence?