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The online game maker of popular Facebook pastimes such as FarmVille and CityVille hopes to raise $1 billion.
Posted 7/ 1 11 at 1:30 PM | News, Money, Online Business
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Zynga, the online game maven and founder of wildly popular virtual playpens like FarmVille, has filed an IPO, with plans to raise up to $1 billion.According to its SEC filing, Zynga is very profitable compared to similar startups, citing more than $90 million profit on sales of nearly $600 million in 2010. In the first three months of 2011 alone, Zynga earned nearly $12 million on sales of over $235 million.
Zynga profits from its reported 60 million daily active users who pay real cash to play and improve their virtual worlds, spending 2 billion minutes per day playing games.
The company also employs a unique revenue tool that uses advertising. Companies like Starbucks pay to have virtual shops put in games like CityVille, where members can build their own Starbucks franchise within their "city."
The Zynga deal has attracted several underwriters, including Morgan Stanley, Goldman Sachs, Bank of America, Barclays, JP Morgan and Allen & Co.
Despite its high valuation and user popularity, Zynga wasn't always the golden child of online gaming. In the past, Zynga was chastised for often spamming sites and users and was even restricted by Facebook for clogging up members' newsfeeds.
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Comments (Page 1 of 1)
Awww. More Smoke and Mirrors and junk investments from Wall Street and the Goldman Sachs group. Any college kid with programming experience can create a game app. There are a million of them out there --- much more fun to play than Farmville. The idea that Zynga is worth a billion bucks is quite frankly lies. Be very wary American public. Investors want to help their corporate friends, make their commissions, make the CEOs rich and then, when the company fails --- leave you and Mainstreet holding the bag. DONT fall for this crap!