By Christiana Sciaudone
Investing.com -- Bill Gates-backed QuantumScape is "a pump and dump SPAC scam by Silicon Valley celebrities that makes Theranos look like amateurs."
That's according to Scorpion Capital.
Quantumscape Corp (NYSE:QS), which makes lithium car batteries for vehicles, tumbled almost 13% after the short-seller published a scathing 188-page presentation accusing QuantumScape of all manners of fraud.
"Our due diligence of QuantumScape’s six key technical claims leads us to conclude they lack credibility and exhibit Theranos-like red flags," according to the presentation. "Volkswagen (DE:VOWG_p) employees indicate that engineers and battery experts internally are highly skeptical of QuantumScape’s claims, getting 'nice Powerpoint slides' and little else."
Volkswagen AG (DE:VOWG) is also a backer of the company.
A Quantumscape representative wasn't immediately available.
QuantumScape went public via a special-purpose acquisition company in December, raising almost $700 million. Shares have dropped around 70% since then. It's the latest company to be targeted by a short-seller. Last year, the founder of Nikola Corp (NASDAQ:NKLA), Trevor Milton, stepped down after Hindenburg Research accused that company of fraud. It went public via SPAC in June.
Theranos, led by Elizabeth Holmes, claimed to have devised quick tests that needed small amounts of blood and raised some $700 million, giving it a $10 billion valuation. Holmes has since been charged with fraud by the Securities and Exchange Commission, and is set to be on trial for wire fraud and conspiracy in California later this year.