Legendary short seller Jim Chanos: Uber and Lyft went public because they had to, not because they wanted to

The talk at the Indian Harbor Yacht Club Thursday night was about cars instead of boats for a change.

Legendary short seller Jim Chanos, the billionaire founder of Kynikos Associates, spoke at the Connecticut Hedge Fund Association’s second quarter meeting in a fireside chat with Fox Business reporter Charlie Gasparino.

Chanos, a well-know Tesla short, spent a good part of his hour-long conversation on the state of the market, comparing it to the dotcom bubble in the early 2000s. He told the roughly 60 attendees that ride-sharing companies Uber and Lyft only went public because their funding had run out in the private market.

“It’s not that they wanted to go public, but have to,” Chanos said. “They were beginning to exhaust their funding from the VC and sovereign wealth funds.”

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The two companies — which have stumbled in their debuts as public companies — could not keep relying on private money because they were leaving the early-stage growth cycles that’s favored by venture capital, Chanos said.

Representatives for Uber and Lyft did not immediately return requests for comment.

Even compared to the tech bubble, when companies like Ask Jeeves and Pet.Com rapidly grew in value, Chanos is “stunned at the number of huge loss-making enterprises” operating now.

“It’s real money” they’re losing every quarter, he said in astonishment.

Still, he thinks any similarities drawn to the 2008 financial crisis now are overblown, telling Gasparino that the economy is “not even close” to a “Lehman moment.”

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However, the easy money that has been available to startups appears to be drying up, which indicates investors might be concerned about a potential rate hike from the Federal Reserve— or even a prolonged economic slump. He specifically pointed to SoftBank, which has begun selling off some of the stakes in now-public companies, like Alibaba.

“When the crazy drunken buyer of last resort becomes a seller, or has their drink taken away, then maybe there’s a hangover coming,” he said.