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June 29, 2011

Zynga Hunting Down $2 Billion IPO With $20 Billion Valuation

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ZyngaSocial media game developer Zynga has become a behemoth of the online market. With titles that include FarmVille, CityVille, Words With Friends, Hanging with Friends and even a Lady Gaga inspired GagaVille the company currently attracts more than 214 million active monthly users (AMU’s).

With those types of numbers it shouldn’t surprise anyone today to learn that the company has officially filed for an Initial Public Offering (IPO) to the tune of $2 billion.

If the company is able to attract the full value they seek, which myself and numerous other analysts believe they will it would value the company at $20 billion.

The IPO could be an important barometer for IPOs in the social media space, since going public LinkedIn has watched their stock value decline from initial highs, while Chinese social site Renren which became the first social media network to go public has lost half of their value since May.

One advantage Zynga has over other social networks is their ability to grow from outside of one network, they could just as easily adapt their games for their own social gaming platform as place them on Facebook or even offer them through Twitter should that day arrive. The company also has a rabid fan base who install new games the moment they become available, while promoting those games to all of their friends through constant social network updates and requests to join in the fun, a fact that makes the company one of the first to fully take advantage of the viral nature found in social gaming. read more

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