For those of you not in the know, Zynga is the maker of Farmville and Mafia Wars games on Facebook and as a standalone app. Earlier this year it applied to IPO. Roadshows should start soon. However publicity over its treatment of its employees are coming to light and not in a good way.
Its reputation could've possibly affected potential acqusitions of Popcap, which it offered $950M in cash, and Angry Birds maker, Rovio, for $2.5B. Both turned down offers.
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Zynga to employees: Give back our stock or you'll be fired
Current implied valuations on Sharepost stand at $12.9B, as of Nov 29, 2011. 2011Q1 earnings hit $12M with full year revenues believed to be above $1B.
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Zynga road show kicks off next week: sources
Games are for free, but die-hards called whales (named after their casino counterparts), will spend money to gain that edge over others. It was estimated that 1% of Zynga's players account for 25-50% of its revenue. It's the new revenue model for the free video game business model. Businessweek highlighted a customer who spent $500 in Farmville and a competitor to Zynga claiming it had 200 people who spent more than $10,000 per year on their games.
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