5 Min Read
MONTREAL (Reuters) - Serial entrepreneur, dog lover, social networking czar and Zynga Inc founder Mark Pincus on Friday took a big step toward joining Wall Street's Internet elite.
The four-year-old company -- named after Pincus's American Bulldog, a now departed pet whose profile is the Zynga's logo -- filed for an initial public offering, the latest in a series of hot Internet debuts including LinkedIn.
It took four start-up attempts for the Wharton graduate and Chicago native to strike gold, when he captured the imagination of millions by bringing easy-to-play online games Farmville and Mafia Wars to the social community of Facebook via Zynga.
"He is a bit of a comeback kid. He just kept trying. Once in a while he got a foul ball but with Zynga, this is clearly a home run. He's now in the World Series of the videogame market," said David Blumberg, managing partner at Blumberg Capital.
The soon-to-be billionaire -- a source said Zynga could be valued at $15 billion to $20 billion -- and admitted workaholic seems on the surface an incongruous addition to the current crop of rising Silicon Valley stars.
"They (Zynga) are not as high-profile as other start-ups. I don't think it's aloofness, they are just trying to focus on their business," said Mike Vorhaus, president of consulting firm Magid Advisors.
Unlike Facebook chief Mark Zuckerberg or Groupon CEO Andrew Mason, non-Wall Streeters who jumped into tech at an early age, Pincus took a more roundabout route to Internet stardom.
At 45 he is from an earlier generation, was schooled in finance, once held a white-collar office job at a telecoms company and spent two years working in Hong Kong.
Like his peers, Pincus latched onto a successful formula for cashing in on the fad for social networking. In just four years, Zynga's revenue swelled to almost $600 million in 2010 from just under $20 million. Today, it claims almost 280 million active users a month -- or about the population of the United States.
"At first we didn't realize how big social gaming could be, but once we launched our first game and we saw how viral it could be and that people wanted to play games together, we started to see how big the audience could get," Pincus said on the Charlie Rose show in December 2009.
Not everyone is convinced that sort of growth is assured long-term, particularly as Zynga is heavily reliant on a third party -- Facebook -- where most users play its games.
Zynga's business practices were also criticized in its early days, when it offered users in-game currency if they downloaded phony tools or signed up for dubious advertising offers. Pincus admits he pushed the limits.
"I knew that I wanted to control my destiny," he once said. "So I funded the company myself but I did every horrible thing in the book to -- just to get revenues right away."
Pincus and his company have an ambivalent relationship with the $65 billion videogame industry. Though Zynga's valuation is expected to exceed Electronic Arts or even Activision Blizzard, the industry hasn't embraced the upstart.
When Farmville won the Academy of Interactive Arts and Sciences award in Las Vegas for best social networking game in 2010, loud boos accompanied the announcement and the Zynga executive sent to collect the award walked out hastily, according to someone at the event.
Zynga's own stance isn't helping things. Pincus turned down requests to join the industry's main trade groups, such as the Electronic Software Association.
"We've approached Zynga before and asked them to participate, but it hasn't seemed, until recently, that they were as invested in having a seat at the table as we were in having them there," said a board member of the Academy who did not wish to be identified.
That attitude extends to Pincus own persona. He wrote on Twitter in April 2009, two years after his company was founded: "Does anyone else feel a new social pressure to have interesting lifebits to post? SORRY. I mostly just f****** work and I'm really boring!"
His focus on work sometimes rankles employees.
"He just drives people very hard. He realizes it's a competitive business," said venture capitalist Blumberg. "I'm not saying he is an impatient person, but he is action-oriented and a very high adrenaline guy."
What Pincus has time for are his beloved canines -- whom he tweets about regularly -- and his company. Zynga has embarked on a hiring spree, luring well-known executives in the industry.
"It's a mark of strength of the CEO that he's not afraid to bring in people who might know something that he doesn't," said Wedbush Securities analyst Michael Pachter.
"That says a lot about Pincus's leadership."
Additional reporting by Mary Slosson in Los Angeles; Writing by Edwin Chan; Editing by Gary Hill