TMCnet Feature Free eNews Subscription
December 12, 2011

Zynga IPO Coming This Week: Reports

By Erin Harrison, Executive Editor, Strategic Initiatives

Investors are gearing up for the initial public offering of popular online game maker Zynga (News - Alert) sometime this week. According to media reports, the company’s founder and CEO, Mark Pincus, is by all accounts playing to win.

Zynga makes free games such as “FarmVille” and “Mafia Wars,” which are among the most popular on Facebook (News - Alert). It makes money by selling virtual houses, poker chips and other items for use in the games. Zynga also makes the addictive “Words with Friends” app played by both iPhone and Android (News - Alert) users.

Zynga’s IPO would be the biggest from a U.S. Internet company since Google raised $1.7 billion in 2004, according to Reuters, which said the IPO would be valued at about $925 million.

“Zynga’s stock structure grants Pincus his own class of C shares that carry 70 times more voting power than regular A shares. The company also has B shares for other insiders that offer a 7-to-1 voting ratio to regular shares,” reported The Economic Times.

Pincus’ 70-to-1 voting ratio is considered “very high” compared with other companies such as LinkedIn (News - Alert) Corp, which has a 10-1 voting ratio, the report said.

Pincus is described as a “control freak,” which would account for such an unusually high voting ratio. But all that control freakishness has apparently worked for Pincus through the years: He has a net worth of $2 billion, according to Forbes.

A February 2011 infusion of $490 million from private investors values Zynga at $11.15 billion, the company says.

By the way, to balance out the “control freak” commentary, Pincus is also reportedly an avid fan of all Zynga games.

The San Francisco online gaming company is the latest in a sequence of IPOs by Internet companies this year, ranging from professional networking service LinkedIn Corp. to the digital discount site Groupon Inc. – all forerunners to Facebook’s IPO expected in the second quarter of 2012. Analysts have predicted that Facebook could see as much as $10 billion in its offering.


Erin Harrison is Executive Editor, Strategic Initiatives, for TMC, where she oversees the company's strategic editorial initiatives, including the launch of several new print and online initiatives. She plays an active role in the print publications and TMCnet, covering IP communications, information technology and other related topics. To read more of Erin's articles, please visit her columnist page.

Edited by Chris DiMarco
» More TMCnet Feature Articles
Get stories like this delivered straight to your inbox. [Free eNews Subscription]
SHARE THIS ARTICLE

LATEST TMCNET ARTICLES

» More TMCnet Feature Articles