8 facts about Zynga before the IPO

Zynga will likely IPO in the next one to two years. Here are 8 things you should know before the IPO.

It appears Zynga’s fishing about for $250 million in new funding, according to the Wall Street Journal. The deal could value the company somewhere between $7 billion and $9 billion. On the low end, that’s a jump of 75 percent since the company’s $4 billion valuation in April. Not bad for 10 months of work.

According to the Journal, Zynga will likely IPO in the next one to two years. Here are 8 things you should know before the IPO:

1) Zynga’s gone acquisition crazy. The three-year-old game studio has acquired companies at a rate of one per month over the past nine months, according to the Journal. That’s a big influx of talent that should keep Zynga on the cutting edge of social-networking and mobile-based gaming – not just in the U.S. but abroad as well.

2) Zynga’s app portfolio is more than just FarmVille. All told, Zynga has 18 apps running on Facebook right now – five of which are among the Top 10 most popular apps on the social-networking site. Zynga’s offerings range from word games (Scramble and PathWords) to role-playing games (Fashion Wars, Vampire Wars and Pirates) to virtual world games (FarmVille, CityVille, YoVille and Treasure Isle). The company also has apps running on MySpace, Yahoo!, and the iPhone.

3) Virtual goodies = real cash. Zynga makes money for the most part through the sale of in-game virtual goods (such as chickens in FarmVille) and in-game advertising. The company’s advertising campaigns are creative and immersive. One deal with McDonald’s, for instance, gave FarmVille users free virtual rides in McDonald’s hot air balloons and the ability to visit a McDonald’s virtual farm. Zynga has even partnered with credit card companies to let card users redeem points for virtual in-game goodies.

4) Moving offline. Zynga’s brands are gradually seeping into the offline world. As of last March, 12,800 stores across the country (including Best Buy) were offering pre-paid game cards that could be used to buy virtual goodies in Zynga’s games. The company’s also started selling toys and bracelets that capitalize on themes in their most popular games.

5) Heading east. Zynga’s first push into the Asian market came last May when the company acquired Beijing-based social gaming company XPD Media. The move gave Zynga access to apps running on China’s version of Facebook, RenRen.com (a company that could IPO this year).

6) Turning Japanese. Not only does Zynga have its fingers in China, the company’s also forged an alliance with Japanese tech-giant Softbank. Softbank invested $150 million in Zynga in July. That money helped launch Zynga Japan, which is building apps specifically for the Japanese market.

7) Zynga’s perks rival Google’s? Google, Inc. (NASDAQ:GOOG) regularly appears atop lists of the United States’ best places to work, but Zynga might be in the running soon. Employees singled out for quarterly awards apparently get their choice between a “carload of vested stock” or a “weekend spin in a $200,000 Lamborghini.” Game engineers can send administrative assistants to their homes to wait for visits from the handyman and company-paid acupuncture treatments just might increase worker productivity.

8) Incredible reach. Getting burnt out on a particular social game seems like it’d be a problem, but CityVille and Farmville appear to be doing just fine. CityVille’s got 96 million active monthly players and Farmville’s got 51 million. Across all the company’s apps, Zynga claims 275 million active monthly users, according to the Journal. With numbers that rival the entire population of the U.S., it’s no wonder investors are falling all over themselves to get a piece of the action.

Related

COUPONS ON THE GO


Is Poynt Corp. a mobile Groupon? (CVE:PYN)


IPO CALENDAR


The unofficial tech IPO calendar for 2011


WI-FI IN THE SKY


Will Gogo IPO in 2011?


BE MY FRIEND?


China’s Facebook: RenRen.com?


SHOW ME YOUR RESUME

3 reasons to buy LinkedIn shares during IPO

PLASTIC IS PASSE


NFC: The next trillion dollar industry (AAPL)

1 thought on “8 facts about Zynga before the IPO”

Leave a Reply

Your email address will not be published. Required fields are marked *