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Hamish Douglass, the co-founder of the Magellan Financial Group with $50 billion under management, recently remarked that Uber has a capital raising strategy that is essentially a Ponzi scheme.

All they do is keep increasing their private market valuation and someone always says, I’ll put some money up, because next time they raise, it’ll be at a higher price,” says Douglass.

Douglass and Chris Mackay founded Magellan a decade ago on the investing principles of Warren Buffet at Berkshire Hathaway. He went on to say that he believes the San Francisco unicorn has a 99% probability of collapse.

When I look at Uber…I think of it as one of the most stupid investments in history,” the Australian Financial Review reported him saying. “The probability of this business not going bankrupt in a decade is like 1%.”

Even if Douglass is mistaken about its financial viability, the fact remains that Uber has suffered an onslaught of turmoil, chaos and executive exodus in recent history. Below is just a brief list of the scandals that have plighted the company in the past few months:

  • The exposure of a secret program called Greyball, which was developed to illegally move Uber into cities it was not permitted to operate
  • An “accounting error” which resulted in tens of millions of fares not being paid to New York City drivers
  • A recent lawsuit claiming that Uber actively and methodically defrauds drivers in California by charging passengers a higher fare than those reported to the driver
  • The recent firing of 20 employees who were involved in a host of sexual harassment charges
  • A class action lawsuit claiming that Uber skims $7.4 million per month from its local passengers
  • A female engineer, Susan Fowler, going public with the company’s rampant sexism and a culture overtly promoting sexual harassment 
  • CEO Travis Kalanick being caught on camera in a ruthless verbal attack against a fellow Uber driver

In the most recent development, Uber has fired Anthony Levandowski, the self-driving car executive at the center of a legal battle with Google over stolen trade secrets.

Waymo, Google’s self-driving car company, is suing Uber for using technology stolen by Levandowski while he was still at Google. Waymo also claims that Levandowski stole 14,000 secret documents from the company.

Douglass’ criticism of the business comes shortly after venture capitalist Fred Wilson – famed for early stakes in Stripe, Twitter, Etsy and Twilio – said Uber’s “win-at-all-costs” strategy would be the company’s undoing.

Despite a paper valuation of more than $60 billion, Uber lost $2 billion in 2015, followed by an astounding $2.8 billion loss in 2016.

According to Anand Sanwall, a venture capital analyst, his professional analysis seems to echo that of Douglass. “It’s a Ponzi scheme of ambition. ‘We’re gonna raise money on the promise of dominating an industry to come in order to pay for this thing that doesn’t make us money right now.’ ” Further, in an informal poll of subscribers to his newsletter asking how many would invest in Uber today, 77% said they wouldn’t.

In other words, there are those who not only believe the darling unicorn is highly overvalued, but that if it doesn’t change course very soon, Uber could wind up as the next Myspace.