Welcome to the Oracle Modern Marketing Blog:
The latest in marketing strategy, technology, and innovation.

10 Fast Facts About Zynga

It’s that time again…Time for us to bring you another edition of 10 Fast Facts plucked from a company’s S-1 filing. After months of expectation, social game-maker Zynga, creator of Farmville and Cityville, snuck in its intention to go public right before the long weekend. As our 4th of July gift to you, we deliver 10 Fast Facts About Zynga. Read it, and then go fire up the BBQ!

Massive Multiplayer
Zynga has 148 million unique monthly users in 166 countries, 60 million daily active users interacting with each other 416 million times a day, and its player base spend a total of 2 billion minutes per day with the site. That’s a lot of crops.

Beyond Facebook Credits
From 2008 to 2010, Zynga’s adjusted EBITDA increased from $4.5 million to $392.7 million. It’s first quarter EBITDA increased from $93.6 million in 2010 to $112.3 million in 2011. The company’s profit last year was nearly $90.6 million and $11.8 million in the first quarter of this year.

Top Of The Charts
Since 2009, a Zynga game has been the most popular game on Facebook every month. According to AppData, Zynga has more monthly active users on Facebook than the next 15 social game developers combined. Additionally, the company’s Words with Friends and Hanging with Friends games are the two most popular word games on the Apple App Store for iPhone.

Friends Forever
Zynga’s S-1 filing reveals just how dependent on Facebook the company really is. Zynga makes “substantially all” of its revenue through Facebook. Under an agreement with Facebook, the company collects revenue through Facebook credits. Facebook returns to Zynga 70% of the face value of credits purchased by the game-maker are players. That agreement expires in 2015.

Don’t Block Me, Bro!
Seriously, Zynga really doesn’t want to be de-friended by Facebook. Not only does the company say that a loss in Facebook’s user base would have negative repercussions on its business, but it’s also dependent on Facebook’s moods. For instance, in 2010 Facebook changed the policies for how application developers could use its communication channels. “These changes limited the level of communication among users about applications on the Facebook platform. As a result, the number of our players on Facebook declined.” I thought I was seeing less Farmville requests in my newsfeed.

Storage Space
Zynga is collecting a massive amount of data. Players create and store more than 38,000 virtual items every second. The company’s data warehouse now processes 15 terabytes of game data every day.

Built To Scale
The game-maker is touting its cloud-based infrastructure. For instance, the company claims it can add up to 1,000 servers in a 24-hour period to meet game demand and they routinely deliver more than one petabyte (that’s 1,000 terabytes) of content per day.

Inquire Within
Zynga has more than 2,000 employees, and most of them have entered the doors in the past two years. In fact, at the end of the first quarter, 64% of employees had been with the company less than a year, and a staggering 92% had been there less than two years.

R&D Still King
While sales and marketing expenses has grown exponentially, research and development costs still outpace them. Sales and marketing costs rose by 131% in the first quarter of this year when compared to the same period last year, reaching nearly $40.2 million. But R&D rose 158% over the same time, reaching nearly $72 million.

Executive Perks
Zynga CEO Mark Pincus’s sister, Laura Pincus Hartman, who is a professor of business ethics at DePaul University, is paid $5,000 a month for consulting services related to Zynga.org, a charitable arm of the company. Zynga has also paid Pincus approximately $900,000 over 2009 and 2010 to rent office space he owns and approximately $125,000 over the same period in connection to an aircraft he owns that was used for business travel. Over the past year, Pincus was paid $12,998 for vehicle leasing expenses and $69,587 for security.

Zynga paid Luminor Group LLC $100,000 for strategy consulting services. Zynga’s Chief Business Officer, Owen Van Natta is a general partner of that firm. As a result of those services, Zynga also awarded 233,376 ZSUs (a special company issued restricted stock unit) to Van Natta.

The company awarded more than $1.1 million in total to three of its most highly compensated executives for relocation-related expenses and bonuses.

Be the first to comment

Comments ( 0 )
Please enter your name.Please provide a valid email address.Please enter a comment.CAPTCHA challenge response provided was incorrect. Please try again.