Why Do You Want To Kill My Pet? Zynga Shuts Down PetVille, 10 Others

Source: Why Do You Want To Kill My Pet? Zynga Shuts Down PetVille, 10 Others

Source: Why Do You Want To Kill My Pet? Zynga Shuts Down PetVille, 10 Others
Today’s “Zynga Unleashed” event in San Francisco revealed moves to allow third-party game developers to use Zynga’s technology platform and a new “Zynga with Friends” brand for multiplayer social interactions that could help the game company reduce its dependency on Facebook. Oh, and the company announced some new games, too.
There was no announcement, however, of the rumored real-cash gaming deal that would have brought down the house.
A Gaming Platform, Not Just Games
Uncharacteristically, CEO and Founder Mark Pincus began the conference by discussing the Zynga “platform” and infrastructure, rather than the new games that typically lead off similar events. There were a lot of numbers thrown around: number of logins, number of inbox clicks, even the number of bubbles popped in Bubble Safari. The upshot was that while Zynga’s games may be small and simple, the infrastructure behind them is big, scalable and sophisticated.
Why is that important? While the details are still pending, Zynga Chief Engineer Kostadis Roussos announced that Zynga will be opening its application programming interface (API) to third-party developers, giving them access to that infrastructure.
This could have two big impacts on the game industry and Zynga:
1) Depending on pricing, access to Zynga’s platform could lower the cost of entry for new, startup game developers. Ideally, they’ll be able to focus more on game design and less on building a scalable back-end.
2) It will take some of the creative burden off of Zynga. Pincus’ developers still have an interest in creating the best possible games, but as a technology provider they can still earn a cut of other hit games. This should provide some earnings stability and reduce the need for expensive, risky acquisitions like OMGPOP, maker of the fast-tanking super-hit, Draw Something.
Zynga even gave out a URL for interested developers.
Zynga With Friends
In its other big news, Zynga is launching its “Zynga with Friends,” a new brand for its multiplayer social initiative. Highlights include:
Zynga will expand its current pool of development partners and open to third-party developers in the near future. Enabling multiplayer gaming on existing games should be fairly simple , which ties in with Zynga’s new desire to be the facilitator for third-party games.
Still Friends With Facebook
While Facebook and Zynga will continue to be joined at the hip (for example, Zynga.com will still be serving Facebook ads), these inititaives will help Zynga strike out on its own.
The rest of the conference introduced some new and possibly interesting games, including a 40th Anniversary partnership with Atari, Farmville 2, other new ‘Ville games and the new Zynga Elite Slots.
But as the early parts of the conference made clear, the games aren’t really the thing. Zynga is already a data company and it’s trying to become a platform company.
Zynga wants to emulate Amazon (which now makes more money off selling bandwidth, processing and shopping cart services to others than it ever did selling books) and transition to becoming an infrastructure provider, while still building quality games when it makes sense. It’s a grand vision that promises increased, stable profits with reduced risk. But a lot still has to happen to make that vision a reality.
Source: Zynga Wants to Sell Its Technology, Not Just Its Games
Today Zynga announced its fourth quarter earnings and 2011 financial results. Zynga now holds the top five games played on Facebook. Its non-GAAP earnings per share were five cents, or $37.1 million for the quarter. But even though it had a 59% gain in sales, it posted a loss for the period.
If Zynga is going to succeed, FarmVille has to lose its super uncool factor. And “play” must become a completely mainstream behavior that’s as acceptable as buying $30 t-shirts at Urban Outfitters.
“We see [play is] a popular large-scale behavior, but we’d like to see play reach a level of search, shop and share, and we think the monetization opportunity will follow that,” said Zynga CEO Mark Pincus. If Zynga is to succeed, it will be because the users make play as much a part of their daily routine as checking Facebook.
For the fourth quarter ending on December 31, Zynga reported a net loss of $435 million, or $1.22 per share. It also incurred a huge expense in the fourth quarter amounting to $510 million, which was related to stock-based compensation from the IPO.
And daily average users (DAU) are not really on the rise.
Zynga had 54 million DAUs, which is up 13% from a year prior. But that number did not change in the third quarter; it was down from 59% in the second quarter and 62% in the first quarter.
Zynga launched 12 games in 2011, including four web-based platforms and eight mobile. In its S-1, Facebook revealed that Zynga games accounted for 12% of its revenues.
Its first hidden objects game Hidden Chronicles is currently at number two on Facebook. Dream Heights, one of its newer games, is expected to perform at rates comparable to a Web game.
Zynga is also working on diversifying its monetization strategies, introducing coins and “power-ups” to games like Scramble With Friends. CityVille was a top performer in Q4, and continues to do well on Facebook. Zynga Poker is also has one of the world’s largest online poker game, and one of the top 6 games on Facebook. Zynga’s mobile space is growing fast as well, with 15 million users.
Zynga also recently announced a real-world component to all those virtual goods. Last week, AllThingsD reported that Zynga signed a deal with Hasbro to develop toys and games based on popular Facebook games and characters. Finally, a link from the virtual world to the real world.
But everything on the Web depends on you, the user.
Zynga CEO Mark Pincus says that “play” is the new TV. The reason TV got so popular? “It was free and accessible to everyone…and play is following a similar trend, only faster.” Will it?
Source: Zynga’s Success Depends On Play
Today Zynga announced its fourth quarter earnings and 2011 financial results. Zynga now holds the top five games played on Facebook. Its non-GAAP earnings per share were five cents, or $37.1 million for the quarter. But even though it had a 59% gain in sales, it posted a loss for the period.
If Zynga is going to succeed, FarmVille has to lose its super uncool factor. And “play” must become a completely mainstream behavior that’s as acceptable as buying $30 t-shirts at Urban Outfitters.
“We see [play is] a popular large-scale behavior, but we’d like to see play reach a level of search, shop and share, and we think the monetization opportunity will follow that,” said Zynga CEO Mark Pincus. If Zynga is to succeed, it will be because the users make play as much a part of their daily routine as checking Facebook.
For the fourth quarter ending on December 31, Zynga reported a net loss of $435 million, or $1.22 per share. It also incurred a huge expense in the fourth quarter amounting to $510 million, which was related to stock-based compensation from the IPO.
And daily average users (DAU) are not really on the rise.
Zynga had 54 million DAUs, which is up 13% from a year prior. But that number did not change in the third quarter; it was down from 59% in the second quarter and 62% in the first quarter.
Zynga launched 12 games in 2011, including four web-based platforms and eight mobile. In its S-1, Facebook revealed that Zynga games accounted for 12% of its revenues.
Its first hidden objects game Hidden Chronicles is currently at number two on Facebook. Dream Heights, one of its newer games, is expected to perform at rates comparable to a Web game.
Zynga is also working on diversifying its monetization strategies, introducing coins and “power-ups” to games like Scramble With Friends. CityVille was a top performer in Q4, and continues to do well on Facebook. Zynga Poker is also has one of the world’s largest online poker game, and one of the top 6 games on Facebook. Zynga’s mobile space is growing fast as well, with 15 million users.
Zynga also recently announced a real-world component to all those virtual goods. Last week, AllThingsD reported that Zynga signed a deal with Hasbro to develop toys and games based on popular Facebook games and characters. Finally, a link from the virtual world to the real world.
But everything on the Web depends on you, the user.
Zynga CEO Mark Pincus says that “play” is the new TV. The reason TV got so popular? “It was free and accessible to everyone…and play is following a similar trend, only faster.” Will it?
Source: Zynga’s Success Depends On Play

Zynga CEO Mark Pincus named his gaming company after his late American bulldog, a beloved yet health issue-ridden breed with a short life expectancy. Ninety-five percent of four-year-old Zynga’s business depends on Facebook. Will Zynga’s overdependence on Facebook make it repeat the story of the bulldog it was named after?
Zynga priced its shares in the $8.50-$10 range. It aims to be the biggest tech IPO since Google’s in 2004.
When the company began trading on NASDAQ this morning, the public offering kicked off at the high end at $10 per share. The 100 million shares priced at $10, putting the company valuation at $7 billion.
Analysts predict that Zynga will under-perform, and that shares are priced too high for a company with such a high-risk business model. Zynga’s stock opened at $11 a share today on NASDAQ. It quickly dropped to below its initial public offering price of $10 within the first 10 minutes of trading.
In its developer agreements, Facebook promises Zynga that it won’t make any Facebook games. If it does, Zynga can bolt. In its initial filing, Zynga noted that almost all of its unique monthly active users were from Facebook. But Facebook will not flat out buy Zynga because Google is a Zynga investor – and Facebook certainly doesn’t want to pay off one of its main rivals. That’s why Zynga is keeping its options open.
In October, Zynga launched Project Z, a social network designed for games and discussions about them. It’s hosted on Zynga’s own site, and was designed as a way to gain a bit of independence from Facebook. One month prior to the announcement of Project Z, and one day after Facebook’s f8 conference, Google launched Zynga’s CityVille on Google+, hinting at another node of independence from Facebook. Google had been building a game platform for a year or more prior to the CityVille Google+ announcement. Some analysts believe that Google Plus games will rival Facebook.
Zynga launched its first Android social game in November 2010. A few months later, it launched the hit Words With Friends for Android, again shifting the focus away from Facebook dependence.
Even still, Zynga’s mobile games are tied to the social graph, and Project Z uses Facebook Connect.
Source: Zynga Is Now A Publicly Traded Subsidiary Of Facebook
The IPO window is now wide open, with everyone from Zynga to Groupon rushing towards it. Nobody knows how long that window will stay open (rule of thumb is 18 months), so better go public while you can. But today’s IPO filing from Zynga came particularly fast. According to one source, the actual writing of the 150+ page S-1 document was one of the fastest documentation processes for an IPO of this size, only taking two to three weeks.
CEO Mark Pincus abruptly cancelled a planned appearance at the D9 conference at the beginning of June, adding to speculation that was when Zynga decided internally to go ahead with the IPO. The three-week period referenced above was the time between what is known as the first “org meeting” with bankers and the final document filed today.
Zynga’s financials are strong, so they could really get the IPO process anytime they want. But there is definitely a sense that the urgency level picked up all of a sudden.
One theory—and it is only a theory at this point—is that Facebook may be moving up its own internal IPO schedule. It just added Reed Hastings to its board, and there is speculation that it may have already kicked off its internal process to get ready for an IPO. This would still be very early stages, but it would include getting its financial reporting in order if it hasn’t done so already and starting the board process to get it to sign off on looking for investment bankers.
If Zynga caught whiff that Facebook was starting to take actual steps towards an IPO, it might wat to get out ahead for several reasons. One is that it has a good chance at becoming the most sought-after new Internet stock. (It’s financials are much cleaner than Groupon’s). But that position will be short-lived and will last only until Facebook itself IPOs. In the interim, Zynga’s stock will suck up a lot of the demand for publicly-traded Internet growth stories.
Another reason is that if the Facebook IPO is a s well-received as everyone thinks it will be, Zynga could benefit from an expansion of its PE multiple (and stock price) just as a halo effect. All Internet stocks could do well when Facebook goes public, but you have to be public inorder to benefit from that.
Or maybe Facebook has nothing to do with it, and CEO Mark Pincus just wanted to get the filing out before the 4th of July holiday. What do you think?
Photo credit: Flickr/Garry

Zynga just filed for its much-awaited $1 billion IPO and know we know how much founder Mark Pincus and the company’s investors own in the company. Zynga’s investors include Reid Hoffman, DST, Google, Tiger Global, Kevin Rose, Kleiner Perkins, Union Square Ventures, Andreessen Horowitz, Peter Thiel, Foundry Group and IVP.
Pincus is the largest shareholder of Zynga, with 16 percent of the company. Kleiner Perkins owns 11 percent of the company; IVP owns 6.1 percent; Union Square Ventures owns 5.5 percent; Foundry owns 6.1 percent, Avalon Ventures owns 6.1 percent and DST owns 5.8 percent.
Pincus makes a salary of $300,000, and Van Natta earns a salary of $200,000.

Zynga has just filed its S-1 with the SEC, indicating that the company plans to go public. According to the filing, Zynga aims to raise as much as $1 billion, but this could be a place holder amount. Updating
According to the filing Zynga has 60 million daily active users in 138 countries. 38,000 virtual items are created every second and game players spend 2 billion minutes a day on Zynga games. The company had $597 million in revenue in 2010, and posted revenue of $235 million in the first quarter of 2011.
Zynga is profitable, posting $90.6 million in net income in 2010, which is a a 28% net margin. In Q1 of 2011, the social gaming giant reported $11.8 million in profit. Zynga has $995 million in cash on hand.
Founder Mark Pincus writes in the filing of the company’s operational philosophies: Games should be accessible to everyone, anywhere, any time; Games should be social; Games should be free; Games should be data driven and ; Games should do good.
Underwriters include Morgan Stanley, Goldman Sachs, Bank of America, Barclays Capital, JP Morgan and Allen and Company.
Zynga’s investors include Reid Hoffman, DST, Google, Tiger Global, Kevin Rose, Kleiner Perkins, Union Square Ventures, Andreessen Horowitz, Peter Thiel, Foundry Group and IVP.

Let’s be honest: One of the reasons David Hornik actually agreed to be on camera at All Things D is that he didn’t have a startup about to file to go public any second. So we talked about some of his more high profile investments that haven’t always lived up to the hype.
Hornik explains why reports of Blippy’s death have been greatly exaggerated, and why he says the investment still wasn’t a mistake. What’s more he dishes (sort of) of the nine-figure annual revenues of another portfolio company Say Media– the love child of VideoEgg and SixApart. And he tells us about an enterprise software company that’s a budding sleeper hit.
More broadly, he argues the immediate-hit-or-it’s-a-failure misses the point of venture investing. (A philosophy Reid Hoffman might agree with after a decade-long slog at LinkedIn.)