12 December, 2011



Timeline: A chronology of the life of Zynga

Posted: 12 Dec 2011 09:39 AM PST

Zynga is expected to go public any day now. The social game maker could raise more than $1 billion at a valuation of $8.9 billion as it seeks to spread its social games to all platforms where gamers congregate.

Founded by Mark Pincus (pictured right) in 2007, Zynga has has packed an interesting and colorful history into its four and a half years. Here’s our chronology of the life of Zynga.

Dec. 12, 2011 — CastleVille hits 30 million users and Zynga has five of the top five games on Facebook.

Dec. 8, 2011Zynga bets on Google TV with new Texas HoldEm Poker app.

Dec. 6, 2011Vostu settles copyright infringement case with Zynga.

Dec. 2, 2011Zynga prices IPO in range at $8.50 to $10 a share at $8.9 billion valuation. That was lower than the expected $15 billion to $20 billion.

Nov. 21, 2011 — Zynga’s CastleVille hits 5 million daily active users; Zynga has 206.8 million monthly active users and more than 2,500 employees.

Nov. 17, 2011 — Owen Van Natta steps down as Zynga’s chief business officer, but stays on board at the company. Zynga discloses it acquired 15 companies in 2011.

Nov. 14, 2011 — Zynga launches CastleVille; Best Buy launches FarmVille plush toys.

Nov. 10, 2011 — Wall Street Journal reports Zynga leans on some workers to surrender pre-IPO shares.

Nov. 7, 2011 — Bloomberg reports Zynga eyes post-Thanksgiving IPO.

Nov. 4, 2011 — Zynga reports profit growth slowing; Net income is $12.5 million in third quarter ended Sept. 30, down 54 percent from a year ago. Revenue was $307 million, up 80 percent.

Nov. 3, 2011 — Zynga describes its upcoming CastleVille game.

Oct. 14, 2011 — An accounting change, which allows Zynga to show better profits, alarms some analysts.

Oct. 13, 2011 — Zynga says it will trade on Nasdaq as ZNGA once it goes public.

Oct. 12, 2011 — Raptr reveals The Sims Social has stolen millions of players from Zynga.

Oct. 11, 2011 — Zynga says it will launch 10 new games in services at a press conference at its new San Francisco headquarters. The company announces Hidden Chronicles, CastleVille, Mafia Wars Shakedown, Project Z, and Mafia Wars 2 on Google+. Zynga also unveils Zynga Direct, a new way of distributing games.

Sept. 30 2011 — Year-to-date revenue hits $828.8 million and year-to-date net income is $30.7 million.

Sept. 29, 2011 — Zynga announces Enrique Iglesias promotion in CityVille.

Sept. 26, 2011 — Zynga launches CityVille, its most popular game, on Google+.

Sept. 20, 2011 — Zynga launches Hanging With Friends on Android. Zynga announces Mafia Wars 2.

Sept. 16, 2011 — Zynga announces it will add Indiana Jones to Adventure World.

Sept. 8, 2011Adventure World launches.

Aug. 26, 2011 — Zynga gives 70 times more voting power to CEO Mark Pincus.

Aug. 24, 2011 — Zynga adds game card distributors in Europe and Turkey.

Aug. 21, 2011 — Zynga hires EA’s Jeff Karp as sales and marketing chief.

Aug. 16, 2011 — Zynga buys Astro Ape game studio.

Aug. 12, 2011 — Zynga launches Pioneer Trail add-on for FrontierVille.

Aug. 11, 2011 — At Google’s social network games debut,  Zynga launches poker game on Google+.

Aug. 1, 2011 — Zynga launches Words With Friends on Facebook.

July 25, 2011 — Zynga to take version of CityVille to Tencent’s network in China.

July 12, 2011Filing reveals minority investors Google, Peter Thiel, Softbank, and others. EA buys PopCap games for $750 million. PopCap reportedly turned down a higher offer of $950 million from Zynga.

July 8, 2011Zynga buys Five Mobile in Toronto, its 15th acquisition in 13 months.

Filed under: dev, games, mobile, social

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From castles to card games: a rundown of Zynga’s biggest titles

Posted: 12 Dec 2011 09:30 AM PST


Zynga is the most recognizable name in social gaming. Facebook members and iPhone owners alike have seen Zynga’s games continuously rise and fall from the top of the charts over the past few years, and with CastleVille’s launch earlier this month, it is unlikely that will change any time soon. The company is likely to go public soon and raise a ton of money, so we thought we would show this primer on Zynga’s social games so everyone can see what the fuss is all about. These simple, time-consuming titles have taken the  world by storm, bringing in hundreds of millions of users internationally since Zynga’s beginning in 2007.



Let’s begin with the most recent, and fastest growing, Zynga game – CastleVille, released on November 14, 2011. CastleVille follows closely in the footsteps of the other graphical ‘Ville games, focusing on maintaining a kingdom while fighting off monsters called Beasties and exploring the overwhelming Gloom that has swept over the land. The only way to advance into the Gloom is by increasing your Castle Level, which requires actions such as building protective walls. As your character levels up, more buildings, tools and perks become available.

Given its medieval oeuvre, CastleVille feels a little more like an RPG than previous outings, which might draw in some of the social game detractors and those who have tired of the repetitive formula of Zynga’s recent games. CastleVille aims to be yet another resounding success for the prolific company, and as we have reported previously, this title has surpassed CityVille as the fastest growing launch for a Zynga game yet. As of Dec. 12,  CastleVille has 30 million monthly active users on Facebook, according to AppData.

Mafia Wars 2

Mafia Wars 2

If any of the Zynga Facebook games warranted a sequel, it had to be Mafia Wars. Mafia Wars 2 launched on October 10th, and this follow-up to one of the most infamous of Zynga’s arsenal of games completely overhauls the text- and menu-based original to keep it in line with the current generation of graphics and combat-fueled ‘Ville games. Of course, the sentiment is the same: make money, expand your turf, earn street cred and don’t get shot (too much). The Bone Yard is a nice addition for those feeling the need to take out their aggression on tiny avatars of other players.

The recent Zynga games (like many of the older Zynga games) have a specific formula to them, which might be why a game about gangsters feels strikingly similar to a game about medieval kingdoms and another game about a burgeoning empire on a group of islands. Regardless, Mafia Wars 2 is still bringing in over 11.3 million users a month, hanging in there as one of Zynga’s 10 most played games on Facebook.

Empires and Allies

Empires & Allies

Empires & Allies is one of the first of the genre-specific Facebook games by Zynga, and was released on June 1 of this year. It follows in the footsteps of CityVille and FarmVille in terms of resource management, but the story and combat are reminiscent of real-time strategy games. Players must lead an army against the villainous Raven to regain the glory of their nation. You are initially given a small island in which to militarize and begin your siege on the enemy, but expansion is encouraged as more islands open up. It’s the first real Zynga game where combat is the core game mechanic. But the cartoon style is meant to appeal to more than hardcore gamers.

This military-centric ‘Ville also offers a relatively robust player vs. player option for those looking to show off their impressive armies. You can choose to invade other players’ islands in order to take over some of their production and gain extra cash. Empires & Allies maintains 18.2 million members, all of whom can’t help but continue the battle.



Happy birthday to Zynga’s CityVille. Released on Dec. 2, 2010, the title is Zynga’s most popular game, consistently bringing in the most users of any Facebook game. In CityVille, players start off with a small plot of land to populate with houses and farms, growing in level and collecting rent until they can expand their land and their city alike. As you can tell from the screen above, investment in CityVille certainly pays off visually, with sweeping skyscrapers and crowded streets covering the terrain.

This socialized SimCity might not have quite as many gameplay elements as Empires & Allies or CastleVille, but the scope of progression and the grandeur of the cities has clearly grasped millions of players and refuses to let go. Even a full year after its release, CityVille receives over 49.7 million players every month. In other words, this is the biggest Facebook game of all time, and that title won’t be wrested from CityVille’s hands easily.

The Pioneer Trail

The Pioneer Trail (FrontierVille)

Another ‘Ville in the vein of FarmVille, FrontierVille, released on June 9, 2010, plops players in the midst of the Old West, tasked with fending for themselves among the wilderness. If you weren’t paying close enough attention, you might have mistaken this for FarmVille with a slightly anachronistic paint job, and you wouldn’t be too far off. Players farm, plant crops, raise animals, and basically complete FarmVille tasks in a new setting.

Lo and behold, over a year after its launch, Zynga decided to revamp FrontierVille with a new plot, new gameplay elements, and even a new name. The Pioneer Trail was born. This time, although the core FarmVille mechanics remain for those who prefer the Wild West to a modern farm, there is a fully fleshed out adventure players can embark on with three friends (NPCs or other players). This mode breaks the mold of Zynga’s other social games, with cutscenes, non-player characters, and even an ending, but it doesn’t stray too far from its roots in terms of actual gameplay. The Pioneer Trail is still inhabited by over 5.6 million monthly users.

Words With Friends
Words With Friends

Possibly usurping the Wars and the ‘Villes as the most recognizable Zynga property, Words With Friends was not actually designed by the company. Newtoy, Inc. was bought by Zynga after the release of both Chess With Friends and Words With Friends, released in July 2009. But Words fits rather well here in the middle of rundown considering Zynga’s very first title, Zynga Poker. Zynga’s acquisition of the With Friends series complements their original poker title perfectly, even more so now that Zynga Casino is on the way.

Words With Friends is basically online Scrabble with fantastic Facebook integration and simple asynchronous gameplay. Players can start a game with a random opponent or with a friend, either by username or Facebook handle. The game can be played at whatever pace the players choose, and multiple games can be played at once. The game still brings in over 12.3 million users a month. Earlier this year, Zynga With Friends (formerly Newtoy, Inc.) released their third title Hanging With Friends, another iOS success.



If FarmVille succeeded in anything (other than making gobs of cash), it helped break down the wall between gamers and non-gamers. Nearly everyone with a Facebook account planted some corn and raised a few chickens since FarmVille’s release on June 19, 2009, regardless of gender or age. Plus, the basic farming mechanics of FarmVille have appeared in several of the more recent Zynga games, further proving the basic formula’s longevity. FarmVille was Zynga’s first break0ut hit.

FarmVille might be the most simplistic of the ‘Villes. Players own a small farm in which they must plant crops, raise animals…and that’s pretty much it. As players complete these tasks, their level increases and more animals and crops become available to purchase. If you have any neighbors, you can visit their farms and help fertilize their crops and harvest the milk from their cows. Incredibly, FarmVille still rakes in a crowd of over 30 million farmers a month, right behind its graphically superior successor, CityVille. FarmVille recently passed up The Sims Social to become the second-largest game on Facebook again.



The father of the ‘Villes, YoVille, launched in May 2008, took a page from The Sims’ book and gave us a home to decorate and reside in, along with a static town to explore. This is yet another of Zynga’s purchases, one that later spurred them to continue the top-down, avatar creation, social games such as FarmVille and CityVille. YoVille is much simpler than Zynga’s successive games, mainly focusing on being social with other players’ avatars rather than reaching certain goals.

With all the new properties Zynga has introduced over the past few years, YoVille shows its age. The graphics and lack of any real gameplay might turn off new players, but the game still brings in over 2 million users a month, quite an impressive feat for a game as old as this.

Mafia Wars

Mafia Wars

Mafia Wars is the social game that started it all. No Facebook user has managed to escape at least one or two requests to join the Mafia since this game’s launch in early 2008. Mafia Wars, unlike most of Zynga’s more recent titles, including Mafia Wars 2, is a browser based game as opposed to a graphics based one. Players have a limited amount of rechargeable health, stamina, and energy with which to complete tasks and fight other players. Fighting stats are another factor determining which player is more likely to win in a fight.

Throughout its lifetime, Mafia Wars has increased in size by adding cities, which serve as expansion packs of sorts. Some of these cities have remained a permanent part of the game, but others, such as Moscow and Bangkok, were only around for a limited time. The original Mafia Wars, despite the introduction of its sequel, still has over 3.2 million users a month.

Zynga Poker
Zynga Poker

Of course, before Zynga invaded our social networks and mobile phones with farms, mafias, cities and castles, there was Zynga Poker, launched in July 2007. To this day, it remains one of the most played Zynga apps, with almost 29.6 million users every month. This is one of the most popular online poker games of all time. It functions like most other Texas Hold ‘Em games, but as with most of Zynga’s titles, players have the ability to level up. Leaderboards allow friends to compete for better rankings and everyone has the option to send gifts to their friends as well.

The game is available in a multitude of languages across nearly every platform imaginable, and it was recently announced that Zynga Poker would become part of a bigger Zynga franchise: Zynga Casino. All we know for now is that Zynga Poker and Zynga Bingo will be included in this package.


Zynga is a dominating force in today’s social gaming market. Despite the controversy and the shrinking profits, no one can deny the effect Zynga has had on gamers and (previously) non-gamers alike. These might be 10 of the most recognizable Zynga titles, but here are some of the others which still garner millions and millions of fans every month, including Zynga’s latest mobile titles:

Adventure World, Blackjack, Café World, Dream Zoo, Drop 7, FishVille, PetVille, Scramble, Treasure Isle, Vampire Wars, Chess With Friends, Mafia Wars Free, CityVille Hometown, Word Scramble, Hanging With Friends, Drop 7, and Word Twist.

Filed under: games

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Lightbox takes mobile pic sharing a step further with Tumblr-like photo journals

Posted: 12 Dec 2011 09:05 AM PST

Many Android smartphone owners are eagerly awaiting the chance to use the hot photo sharing app Instagram currently only offers on Apple phones. But Instagram’s Android-only competitor Lightbox is debuting a new photo journal feature today that may make some iOS Instagram users jealous.

Lightbox’s original app let you instantly snap, enhance, and automatically upload photos to the Lightbox website and other services. The company’s new photo journal feature — accessible through the new version 2.0 Lightbox app launching today — takes that a step further by automatically grouping together photos in a personal timeline.

So, for example, you won’t need to worry about tagging or sorting all the photos you took during a friend’s birthday party — Lightbox will automatically do that for you, leaving you free to enjoy the party. The resulting photo journal vaguely resembles something you’d see from popular blogging service Tumblr. Even more like Tumblr (and Twitter), Lightbox now allows you to follow other users’ photo journals and vice versa.

Lightbox’s photo journals can be made entirely public, private, or unlisted (accessible only by visiting a specific link). Check out William Shepherd and Koneko Darling’s Lightbox pages for examples.

The feature gives Lightbox a major advantage over Instagram, which is only available on the iPhone at the moment and which goes to great lengths to keep its network locked down on its mobile app. Individual photos uploaded through Instagram can be viewed on the web, but it’s difficult to do seemingly simple things outside of the app, like view all of the photos from a single user. (Third-party services like Webstagram make this possible with Instagram.)

PicPlz, a competing photo sharing app available on both Apple’s iOS and Android, lets you easily explore photos from its users, but it lacks the automatic organization of Lightbox’s photo journals.

Lightbox is also launching a new HTML5 mobile site, which is accessible via the iPhone and other smartphones. You can’t upload photos via the mobile sites, which means iOS users will still need to hold out for a Lightbox app of their own. But the iOS version of the app is less than six months away, Thai Tran, Lightbox co-founder and CEO, tells VentureBeat.

Lightbox launched on Android in June and is approaching 1 million downloads, Tran tells VentureBeat. In comparison, PicPlz, which launched a year and a half ago, has somewhere between 1 to 5 million downloads, according to the Android Market. Lightbox is also around 10 times as popular on Android as Path, which started out as a photo sharing app for your closest friends.

London-based Lightbox has raised $1.2 million so far from Index Ventures, Accell Partners, SV Angel, and others.

Filed under: mobile, VentureBeat

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iPad 3 is just months away; hold off on that holiday purchase

Posted: 12 Dec 2011 08:45 AM PST

ipad 3New information from iPad supply chain makers indicates that Apple is poised to launch the next generation of its tablet device in the next three to four months.

The news comes from Taiwanese blog Digitimes, which has previously picked up accurate news from sources in Apple's supply chain. The report states that iPad 2 production will remain high (14 to 15 million units) in the fourth quarter of 2011, but will decline to under 5 million units in January 2012 to focus on building iPad 3 units.

The report also indicates that iPad manufacturer Foxconn Electronics is expected to produce just under 10 million iPad 3 units in the first quarter of 2012. That number would be comparable to the total number of iPad 2 units currently being assembled.

VentureBeat previously reported that iPad 3 production would begin prior to 2012, with a launch coming soon after. The new information is more aligned to Apple’s past iPad launches, which have been announced roughly about the same time during the last two years. But the first-quarter-2012 timing assumes Apple has resolved possible issues with a new retina display.

Filed under: mobile, VentureBeat

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Kaggle launches competition to help Microsoft Kinect learn new gestures

Posted: 12 Dec 2011 08:23 AM PST

What if it was as easy to add a new gesture to Microsoft Kinect as it is to create a keyboard shortcut?

Big data startup Kaggle just launched a machine learning competition to develop an algorithm that Kinect can use to learn to recognize a new gesture from a single example. There are cash prizes of $10,000 for the top algorithms, and Microsoft may pay up to $200,000 to license them.

Let’s say you want to use a new gesture to control video editing software. Show Kinect a chopping gesture once and using the new algorithm it should recognize that gesture in future. You can then map the new gesture to, for example, the “cut” feature. Adding new gestures currently involves a considerable amount of manual work.

Kaggle runs Big Data challenges, which involve developing new machine learning algorithms or finding useful patterns in large data sets. “Gesture technology is not a mature area,” said Kaggle’s president and chief scientist Jeremy Howard. While learning from a single example, or “one-shot-learning”, is not an new problem in the machine learning world, “It’s not solved well enough,” Howard explained.

The competition is not specifically for gaming applications. The algorithm could be used for tasks like interpreting sign language, controlling robots or appliances or recognizing when a patient in a hospital room is in distress. Each application has its own vocabulary of gestures, which is what makes it important that Kinect can learn them rather than have to be programmed explicitly for each gesture.

Competitors get a set of videos clips showing examples of gestures (one example of each gesture) that they use to develop their algorithm. The gestures come from different vocabularies such as diving signals and American Sign Language. During development, the algorithm can be tested on a set of 1-5 examples of each learned gesture to see how well it performs at recognizing them. A final set of data, the validation set, can be used by competitors to evaluate their progress and compare their work with others. A real-time leaderboard shows participants their current standing based on their validation set predictions.

“Winners are generally not domain experts but machine learning experts,” said Howard. He should know. Before he became its president, Howard was Kaggle’s most successful competitor. Kaggle is popular with data scientists not only as a way of proving their skill but also because Kaggle gives them access to new data sets that are otherwise hard to find. Kaggle’s community of data scientists comprises thousands of PhDs from quantitative fields such as computer science, statistics, econometrics, maths and physics. “We often have people working on 2-3 competitions at the same time,” said Howard.

Kaggle has already had a couple of big wins. A competition run by NASA and the European Space Agency resulted in a 350 percent improvement on the existing algorithms for mapping dark matter. Insurance company Allstate improved 340 percent on the best available algorithm for evaluating how likely it is that someone will be killed or injured in an accident involving a particular car model.

The biggest competition currently running is the $3 million Heritage Health prize, which aims to predict and prevent unnecessary hospitalizations, thereby saving the U.S. up to $30 billion per year in unnecessary hospitalizations. “This is one of the few times that health data has been anonymized and made public,” Howard told me.

Let the games begin.

Kaggle was founded in 2010, is based in San Francisco and has raised $11 million in funding to date.

Filed under: dev, games, VentureBeat

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Samsung sold more than 300M phones in 2011

Posted: 12 Dec 2011 08:18 AM PST

samsung-300M-phonesSamsung has sold over 300 million phones for 2011, a first for the company’s history, the company said Sunday.

The news tops off an incredible year for Samsung, which became the top smartphone manufacturer in the world in late October. Apple held the title for a single quarter earlier in the year, and Nokia held it before Apple. Samsung shipped 27.8 million smartphones in the third quarter alone, accounting for 23.8 percent of the smartphone market. On top of smartphones, the company has sold an huge number of “dumb” phones as well.

“We are incredibly proud of this record-breaking sales milestone and have exceeded the annual target announced early this year, which is testament to the enduring appeal of Samsung phones with consumers around the world,” said Shin Jong-Kyun, president of Samsung Mobile, in a statement.

Samsung’s phone sales in 2010 were about 280 million. What pushed Samsung over the 300 million mark this year could have been the launch of the hugely popular Galaxy S II line. In late August, I wrote a hands on report of the Galaxy S II models for AT&T, Sprint and T-Mobile, and I still believe the S II line includes some of the best Android phones ever released. By September, the Galaxy S II line had shipped more than 10 million units around the world.

Next up for Samsung in the U.S. is the launch of the hyped Galaxy Nexus, which has a 4.65-inch screen and blazing 4G data speeds but still has not been given a release date. The phone was supposedly delayed because Verizon wanted Google Wallet software removed before the launch. Google, Samsung and Verizon’s last official comment about the release date said the phone would launch before the end of the year.

Filed under: mobile

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Modern Warfare 3 sells $1B in just 16 days

Posted: 12 Dec 2011 07:50 AM PST

Call of Duty Modern Warfare 3 has shattered another record, selling more than $1 billion worth of games in just 16 days of sales, according to Activision Blizzard.

The game is on track to beat last year’s Call of Duty Black Ops as the best-selling game of all time. The revenue record also eclipses the film record set by James Cameron’s Avatar, which hit $1 billion in 17 days in 2009.

Call of Duty now has more than 30 million gamers, a community stretched worldwide. That community is about as big as sustained franchises such as Star Wars, Harry Potter, Lord of the Rings, and the National Football League, according to the company.

“Engagement of our Call of Duty audience continues to rise around the world,” said Bobby Kotick, chief executive of Activision Blizzard. “Call of Duty as an entertainment franchise has made an indelible mark on popular culture and its broad and continued success is further validation that audiences increasingly value interactive experiences over passive experiences.”

The Call of Duty Elite gamer social network has recovered from its rough start and has more than six million registered players and one million subscriptions sold.

Filed under: games, VentureBeat

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Mac App Store surpasses 100M downloads — Not bad, Apple

Posted: 12 Dec 2011 07:30 AM PST

Apple announced that Mac desktop owners have downloaded over 100 million applications from its Mac App Store today.

The Mac App Store, which launched January 6, 2011, is an online market place that sells apps for the company’s line of desktop and laptop PCs that run its exclusive OS X operating system. It’s much like the company's mobile App Store, which sells free and paid apps for iOS devices like the iPhone and iPad.

In June, the company announced that its Mac App Store is the number one channel for PC software sales, surpassing big retailers like Best Buy, Walmart and Office Depot. The store has over 500,000 apps available in a variety of categories, including education, games, graphics and design, lifestyle, productivity, and utilities. The company also made its latest OS X Lion upgrade exclusively available through the Mac App Store.

It’s certainly an impressive feat for Apple, which previously faced criticism over the store because it ran counter to the long-standing tradition of software companies selling their own wares.

And while the number of downloads is definitely worth noting, there’s also something to be said for the developer community throwing support behind the idea of a desktop application store. Developers can set their own prices for the apps, but have to pay Apple 30 percent of each sale. The developers do not, however, have to pay for hosting, free applications, App Store marketing or credit card fees.

I’ve used the Mac App store twice since it opened. The first time was for Lion, and the second was for a native Twitter app that I’ve probably only used once. I’m curious to find out how many VentureBeat readers have downloaded more than one OS X app from the Mac App Store. (And of the people who have downloaded multiple apps from the store, how often do you use those apps?)

Filed under: dev, VentureBeat

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How Zynga grew from gaming outcast to $9 billion social game powerhouse

Posted: 12 Dec 2011 07:00 AM PST

Zynga has turned the video game world upside down in its short five-year history. As it’s poised on the verge of a massive initial public offering, the social game startup is now one of gaming’s great success stories.

But its success was never a foregone conclusion. In fact, most game industry veterans didn’t view it as a real game company. Mark Pincus was a four-time entrepreneur, but had no experience in the game industry and had never managed a big company. He was the most unlikely entrepreneur to create a game industry giant.

Now Pincus is poised to become a multibillionaire as the largest shareholder in a company that is about to hold on Thursday one of the biggest initial public offerings of the year. Zynga’s billion-dollar IPO, at an $8.9 billion valuation, will be one of the biggest events in gaming history and will make it a financial peer to established rivals like Electronic Arts and Activision Blizzard. Through the IPO, Zynga hopes to meet the ambitious goal of investing more “in play than any company in history.”

And it is possible in no small part because Pincus, the gaming novice, dreamed bigger than the game industry when it came to giving users accessible and social games, anytime, anywhere. Against all odds, Zynga has out-competed big gaming brands in the great social game Gold Rush. Zynga games have continuously held the No. 1 ranked spot on Facebook since the beginning of 2009. As of today, it has five of the top five games on Facebook.

Pincus couldn’t have done it on his own. Along the way, he has been helped by the fortuitous friendship of gaming veteran Bing Gordon. Facebook insider Owen Van Natta played a key role at a critical time. And experienced game designers like Mark Skaggs and Brian Reynolds have led the creation of innovative, addictive games, helping the company rise above its early reputation as a creator of cheap knockoffs and a persistent spammer of Facebook news feeds. Together, these people helped Zynga get where it is today, while rivals like Playfish and Playdom decided to take earlier, less lucrative exits.

Since its inception in 2007, Zynga has generated more than $1.5 billion in revenues — a remarkable sum for such a young company. It is now trying to seize the leading share of a $9 billion virtual goods market that it believes could triple in the next five years.

Now the company’s ambition is to become as synonymous with play on the internet as Google is with search, Amazon is with shopping, and Facebook is with sharing. It was lucky that Zynga started out with so little game experience in the beginning. But throughout its life, it would have to prove over and over again that it was a real game company that mattered.

In the following pages, I’ll tell the tale of Zynga from its earliest days. This story is based on extensive interviews and research since 2008. We’ve had limited access to Mark Pincus. In recent months, he hasn’t been giving interviews, due to a quiet period mandated by regulators. But the story of Zynga isn’t just about the founder of the company. It’s also about the whole cast of characters who surrounded him, the rivals who drove him to succeed, and the industry that challenged Zynga to prove itself over and over. We’ve done our best to triangulate on how Zynga became what it is today — and how it almost didn’t happen.

Humble beginnings

Cast of Characters

  • Mark Pincus, the founder and CEO
  • Bing Gordon, the game executive and “consigliere”
  • Owen Van Natta, Zynga business executive, former MySpace chief
  • Mark Skaggs, Zynga general manager for FarmVille and CityVille
  • Brian Reynolds, Zynga’s chief game designer, creator of FrontierVille
  • David Ko, Zynga’s senior vice president for mobile
  • Roy Sehgal, game designer and general manager of Cafe World
  • John Schappert, chief operating officer of Zynga and former COO of Electronic Arts
  • Cadir Lee, chief technology officer of Zynga; co-founder of SupportSoft with Pincus.
  • Allan Leinwand, Zynga CTO for infrastructure engineering
  • Colleen McCreary, Zynga’s “chief people officer”
  • Bill Jackson, creative director at Zynga Dallas and CastleVille
  • Yuri Milner, investor at Russia’s DST
  • John Doerr, partner at Kleiner Perkins Caufield & Byers
  • John Riccitiello, CEO of rival Electronic Arts
  • John Pleasants, former CEO of Playdom, now head of Disney Interactive Media

No one would have pegged Pincus as a game tycoon. The Chicago native went to study business as an undergraduate at the Wharton School at the University of Pennsylvania. After graduating, he worked in finance at Lazard Freres and Asian Capital Partners. He went back to get an MBA at the Harvard Business School and graduated in 1993. Then he bounced around at a number of jobs.

“I had a lot of careers before I became an entrepreneur,” Pincus said in a speech about starting companies at Startup Berkeley in the spring of 2009. “And I failed on other people’s money. If you were trying to become a professional athlete, you would want to go through junior leagues first before you started a pro circuit. Fail a lot before you are paying for the failure….I got fired or asked to leave from all my jobs.”

The option that was left for him, Pincus joked, was to become an entrepreneur. He had read George Gilder’s book, Microcosm, and was excited about the economics of the world enabled by technology. That drove him into new media. He eventually made his way to Silicon Valley, starting FreeLoader, a web-based push company, in 1995 with a $250,000 loan. That company was acquired after seven months for $38 million by Individual. It was the start of Web 1.0, or the first giant wave of the first real internet companies.

At the time, other tech companies were selling out for hundreds of millions or even billions of dollars, making Pincus’ exit look almost paltry. Still, his first startup success gave Pincus a full membership in Silicon Valley’s dot-com era. He then founded Support.com (later SupportSoft), a provider of service and support automation software, along with Cadir Lee and Scott Dale. The company went public in July 2000.

Flush with cash, Pincus co-founded his own incubator, Tank Hill in January, 2000. It was just in time for the dot-com crash, and he and his partner shut it down and returned the funds nine months later. In 2003, at the age of 37, he started Tribe.net, one of the first social networks. Pincus thought of it as a “Craigslist meets Friendster.” That didn’t work out so well. Pincus left in 2005, after the board threw him out. In 2006, he took it back over from the investors and sold its assets to Cisco. At the time, Tribe.net had just eight employees, and Cisco completed its purchase by March 2007.

He teamed up with his friend Reid Hoffman, a PayPal veteran and now founder of LinkedIn, to buy a patent on social networking from the defunct Sixdegrees for $700,000. Then they invested in a little company called Facebook, which turned out to be at the beginning of the Web 2.0 wave of companies, or those that were built to take advantage of a newly dynamic web and its growing network of interconnected users. That put Pincus in close touch with Facebook founder Mark Zuckerberg and gave him the inside track to the social media revolution.

Pincus is on record as starting four companies, but he said there were 15 or 20 projects that failed. But Pincus did have a nice touch as an angel investor. His investments included Napster, eGroups, Technorati, Socialtext, Friendster, Ireit, Nanosolar, Merlin, Naseeb, EZboard, Advent Solar, Xoom — and Facebook. Noticeably absent from that list were any game companies.

Making the right bet

To get to Zynga, Pincus said he had three formal failures, including Tribe.net. Another failure was an ad company called Tag Sense. From that, he concluded, “Don’t go start a company just because you have a customer and someone will fund you. If it is a marginal idea, that’s bad.”

Because Tag Sense failed quickly, Pincus said, he was ready when, in the May 2007, Facebook opened up its applications programming interface, inviting other companies to make applications on top of its social network in hopes of beating MySpace. That move helped Facebook gain users as well as developers, creating a virtuous circle. Pincus decided to go along for the ride.

Previously, Pincus had been operating under the name Presidio Media, a company which he formed in April, 2007, as part of an effort to jump on the Facebook bandwagon.
“The whole time I was doing Tribe, I thought the thing I would have loved to do is games,” Pincus said in a 2009 interview:

I’ve always said that social games are like a great cocktail party: You’re happy at first to see your good friends, but the value of the cocktail party is in the weak ties. It’s the people you wouldn’t have thought of meeting; it’s the friends of the friends….What I thought was the ultimate thing you can do — once you bring all of your friends and their friends together — is play games. I’ve always been a closet gamer, but I never have the time and can never get all of my friends together in one place. So the power of my friends already being there and connected, and then adding games, seemed like a big idea.

In July 2007, Pincus changed the name of his new company to Zynga, named after his late bulldog, Zinga. Zynga’s first headquarters were in the Chip Factory in the Potrero Hill neighborhood in San Francisco.

From his previous experiences, Pincus learned, “Control your destiny. We all write this story for ourselves that we were really successful and the evil VC came in and f***** up our company. They backed us and got rid of us and if they had just left us alone. That’s everybody’s sob story in Silicon Valley. You f****** it up because you gave them control of it.” He said he would settle for half the valuation if he could control his company and destiny. As a result of that desire, he funded Zynga himself.

The early team included Eric Schiermeyer, Michael Luxton, Justin Waldron, Kyle Stewart, Scott Dale, Steve Schoettler, Kevin Hagan, and Andrew Trader. Pincus was intense and drove them hard, but he wanted to build a great company.

Its first successes were on MySpace, where other social game companies were making money from ad-based games. Zynga’s early revenue came from MySpace, but Pincus had the smarts to realize that Facebook would win in the future. It was a smart bet that helped Zynga to catch Facebook’s coattails as it went through an unprecedented wave of growth.

As he tried out ideas, he kept in mind that he should test them as cheaply and as quickly as he could.

The company released its first game for Facebook in September 2007. It created a free social poker game on Facebook, chosen because it was simple and it was a universal game that enabled friends to plan a “poker night” with each other no matter if they were far apart or not. Zynga was riding a wave of resurgence that poker had seen since 2003. Zynga’s first game was successful enough to make the company profitable.

“We were the first company to believe in the social gaming opportunity and go after it with our poker game in July, 2007,” Pincus said in an interview with VentureBeat in 2009. “Everybody else was focused on viral apps like pokes and other things that spread more virally. We were always interested in just the gaming opportunity. By the time we saw it was real and had a sustainable revenue stream, we were the first to start investing deeply in it.”

Before Zynga, free games were often viewed as low-quality shareware. But now they were something that millions of people could enjoy. The poker game gained users for a while, but it had no real monetization beyond ads at first. Eventually, in March 2008, Zynga added a way to sell poker chips via “lead generation,” where a user could get chips if they participated in a revenue-generating activity for Zynga, such as accepting an offer to sign up for something.

In a poor choice of words that would eventually come back to haunt him, Pincus later said in his Berkeley speech that “I did every horrible thing in the book to just get revenues right away.” He said that Zynga gave users poker chips in its first game, Texas Hold ‘Em Poker, if they would download a Wiki tool that was difficult or impossible to remove.

In mid-2008, Zynga launched Mafia Wars, its second game, and it acquired another game called YoVille. The Mafia Wars game was available on both Facebook and MySpace, because it wasn’t clear which social network was going to be the winner yet.

In the process of launching its games, Zynga would hit upon some unique ideas that it would later describe as its philosophy. It believed games should be accessible to everyone, anywhere, any time. Games should be social. Games should be free. Games should be data driven. And games should do good. Those were lofty goals, but no one else in the industry believed in trying to make all of those things happen.

Pincus’s intent was to create a real business before he needed to go into a venture capitalist’s office. By the time Zynga raised its first round of money, it had generated only $693,000 in revenue in 2007, but it had a path to growth because its user count was growing fast, and it was already profitable. As a result, Pincus was able to command unusual terms, like giving himself stock that had 10 times the votes of common shares and maintaining control of his board of directors.

He was also able to secure investors that he was already friends with. In a deal announced Jan. 15, 2008, Zynga was able to raise $5 million from Union Square Ventures, Foundry Group, Avalon Ventures, Reid Hoffman, Peter Thiel and other angels.

With the new money, Zynga was able to move even faster at a time when the great Facebook land rush was under way. The social network constantly revamped its platform and app makers had to adjust in real-time. Pincus called this “organic development,” where the company’s own internal developers had to pay close attention to Facebook and redo their work every 90 days or so.

The business would be metric-driven, combining intuition and data. The would enable the business to rapidly iterate and drive reach, retention and revenue. That is exactly how Zynga put distance between itself and others; it learned what users wanted and modified its games quickly, sometimes overnight, to better provide what the users wanted. Zynga started testing every idea. Web 2.0 companies behaved in this fashion, but game companies for the most part didn’t.

But it was true the company forever be at the mercy of the rules that Facebook made.

“Does it bother us that we’re a fly on Facebook’s ass?” Pincus joked in his talk. “In 2007, people laughed at me” for doing a Facebook app company. “We live and die by the changes these guys make.”

Bing Gordon, consigliere for Mark Pincus

Data also could be a game designer’s enemy. If a game didn’t take off, Pincus had no qualms about killing it. He spent $3 million developing an unnamed role-playing game. But the title didn’t take off in a viral way when it launched, so Pincus pulled the plug on it. Pincus became ruthless about canceling games that weren’t working.

Zynga was growing fast thanks to Mafia Wars and Zynga Poker, and it was making money. And Facebook was still growing like crazy.

At the time, the speed was important. Not everyone realized it, but Zynga was in a monumental race to beat others to the treasure. If it learned the most about how to make money from social games and executed the fastest, it would own the market, regardless of whether giant companies came into it later.

So just a few months after its first round, Zynga raised another, larger pile of cash.

In July 2008, the world took notice as Kleiner Perkins Caufield & Byers invested $29 million in Zynga. Bing Gordon (pictured above), the former chief creative officer at Electronic Arts and now a partner at Kleiner, joined Zynga’s board. Mark Pincus welcomed him as a key advisor.

The amount of money was huge for a gaming startup at the time. Few other companies had amassed such a large amount. It meant that Zynga was always going to have a pile of money to invest in its next major titles. That was a luxury that many of its competitors didn’t have, and it was why they fell behind.

Later on, Pincus said that one of the lessons of failure was to surround himself with people that he could learn from. Gordon was such a mentor. While Pincus had the Web 2.0 experience, Gordon knew games. He was able to put Pincus in touch with large number of job candidates in the game industry who were willing to try something new. Some of them, like veteran game designer Mark Skaggs, came from Electronic Arts. He joined as a top game exec at Zynga in November 2008. Skaggs would go on to lead some of the most important games that the company would create.

“I’m a consigliere,” Gordon said in an interview with VentureBeat in the fall of 2010, referring to the Robert Duvall character in The Godfather movie. “I have my own assignments now and then. I have done more recruiting than Robert Duvall. But I have high regard for Mark Pincus as a visionary. He combined the best of the web, games, and social. It never occurred to anyone those would come together.”

Gordon showed up at the company all of the time, lending his advice and bringing in new people as they were needed.

Filed under: games, VentureBeat

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Kindle Fire update coming in less than two weeks, fixes performance, multitouch issues

Posted: 12 Dec 2011 06:49 AM PST

Is your Kindle Fire frustratingly slow? You’re not alone, as many owners of the tablet have complaints about performance. But thankfully, it seems Amazon is listening.

The company says that an over-the-air update, due within two weeks, will alleviate many of the Kindle Fire’s issue with performance and its multitouch screen, the New York Times reports. Additionally, the update will add a much-needed privacy feature: the ability to cover your web browsing history tracks (oddly, the NYT suggests this will be a great way to help you better cheat on your spouse).

For many Kindle Fire owners, the update can’t come soon enough. There are widely reported slowdown issues with the Kindle Fire’s browser, and its multitouch screen at times seems to have a mind of its own. These issues are easy enough to fix with software updates — thankfully for Amazon. But other issues with the tablet, including its lack of an external volume control, are impossible to fix, and consumers will just have to learn to live with them (consider it part of the cost for an ultra-cheap $200 tablet).

The NYT speculates that Amazon will likely deliver a newer Kindle Fire tablet this spring, which falls in line with plenty of rumors surrounding a larger, more powerful Amazon tablet on the horizon. While the Kindle Fire aims for the low-end tablet market, the larger tablet, which is said to sport a 10-inch screen an quad-core processor, would be a direct competitor to Apple’s next-generation iPad.


Filed under: media, mobile, VentureBeat

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Disney’s Playdom launches social game Gardens of Time on iPad

Posted: 12 Dec 2011 06:00 AM PST

Gardens of Time, the most successful Facebook game created by Disney’s Playdom, is launching today on the iPad.

The launch is a major one for Playdom, since the Palo Alto, Calif.-based division wants to replicated the success of the social game on mobile platforms, which are expected to be a significant avenue of growth for social games. The game has been successful because it was the first major “hidden object” game on Facebook. In such games, which are popular on casual game web sites, players search for objects in a scene.

The game launched in April on Facebook and it became one of the most popular titles on the social network. More than 5 billion hidden object game sessions have been played to date, and the game hit a peak of 17 million monthly active users and 4 million daily active users. The game now has 9.1 million MAUs and 2.1 million DAUs, but it is still Playdom’s most popular game on Facebook by far.

The iPad version of the game is integrated with OpenFeint, Game Center, and Facebook. That means that the developers have tried to make the game as social as possible, so that the title can spread in a more viral fashion.

In Gardens of Time, players join the Time Society, an elite group of time-traveling detectives. They explore vibrant hidden object scenes throughout history to guard the secrets of time travel and preserve history’s flow. As players find objects, they earn coins, the games currency, and collect ancient artifacts to personalize a garden that you can show off. As your garden grows, so does your reputation and you can unlock more travel spots.

The game is social because you can interact with other players, challenging them to high scores where you find objects on a time limit. You can send gifts and visit neighbors and compete in a “best garden” contest. John Spinale, senior vice president of social games at the Disney Interactive Media Group, said that Gardens of Time is perfectly suited for the tablet experience and the company sees a chance to engage with millions of players on the go on the new platform.

Filed under: games, mobile, social

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Cloud testing service Soasta secures another $12M in funding

Posted: 12 Dec 2011 04:30 AM PST

Soasta, a cloud-based performance testing services company, has secured $12 million in its fourth round of funding. This series D round was led by Jeff Webber through The Entrepreneurs’ Fund III and existing investors Canaan Partners, Formative Ventures, and Pelion Venture Partners.

The five year old company specializes in performance-testing websites through the cloud with its recently-patented CloudTest visual test creation environment. Soasta can test many functions of a website, including specific front-end features, such as account logins and page loads. Soasta then puts together a report for your website that alerts your company to any issues that may exist. Its services range from a free software download, released this year, to complete turnkey testing services. Soasta's clients include big names like American Girl, Hallmark, Inuit, and Microsoft.

"The explosion of mobile apps has been beyond our expectation," says Soasta CEO Tom Lounibos (pictured above) in an interview. "We are in the business of helping companies and individuals focus on the performance of their web apps and mobile apps moving forward."

The new round of funding will be used to grow the company overseas, as Lounibos explains, "We will be using [the funding] for expansion of many things—mainly geographical expansion into China. There is a market there as more and more people are beginning to use mobile technology. China is a big market for us, [as is] India and Brazil."

Soasta is a privately held company that was founded in 2006 and operates out of Mountain View, CA. This year the company grew to include over 100 employees and over 3,000 clients who use their services. Over the last five years, Soasta has been funded by UV Partners, Canaan Partners, Formative Ventures, Pelion Venture Partners, and The Entrepreneurs' Fund. This latest round brings its total funding to $32 million.

Filed under: deals

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In omninous retrospective, Anonymous warns, “Prepare for 2012″

Posted: 11 Dec 2011 02:38 PM PST

The hacking group Anonymous posted a retrospective video of 2011 in recognition of all of its feats during the year.

The “LulzXmas” video is a montage of all of the security embarrassments, cyber attacks, practical jokes and other mayhem caused in the name of Anonymous.

It isn’t clear if the message is a threat of more attacks coming next year, as Anonymous doesn’t speak with a single voice.

The video starts with cyber-fied Christmas music and includes images of newscasts about the hacking of the PlayStation Network, the Central Intelligence Agency web site, and the prosecution of Julian Assange, head of WikiLeaks. The video then closes with a long rendition of a speech stirring people to revolutionary actions.

“The hate of men will pass, and dictators will die,” the speaker says. It closes with a quote from Thomas Jefferson, who said, “A government afraid of its citizens is a democracy. Citizens afraid of government is tyranny.” And then the video warns, “Prepare yourself for 2012.”

Filed under: VentureBeat

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E-commerce sales hit $25B, up 15 percent

Posted: 11 Dec 2011 02:21 PM PST

U.S. online holiday spending is holding strong, with e-commerce sales reaching $25 billion, up 15 percent from a year ago.

Market research firm comScore said that spending for the first 39 days of the November-December selling season were $24.6 billion. The most recent week ending Dec. 9 reached $5.9 billion, up 15 percent from the corresponding week a year ago.

Last week saw three days of sales each exceeding $1 billion in sales. For the whole season, six days have exceeded $1 billion in sales, including the record-setting $1.25 billion for Cyber Monday on Nov. 28.

Commenting on the sales, comScore chairman Gian Fulgoni said, “These highlights represent another very positive sign for the holiday shopping season, as the week following 'Cyber Week' often experiences relative softness in spending momentum due to retailers pulling back on their promotional activity.”

He added, “As we enter what will be the heaviest week of the season for online retailers – beginning with 'Green Monday' on December 12 – all signs are now pointing to a strong finish to the season.”

[image credit: LeapGo]

Filed under: VentureBeat

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Comedian Louis CK offers $5 DRM-free special, gives the finger to traditional distribution

Posted: 11 Dec 2011 11:12 AM PST

Louis CK is known for pushing boundaries in his comedy, but with his recent online special, “Live at the Beacon Theater,” the wildly popular comedian is also embarking on new territory for entertainment distribution.

Typically we’d have to wait for a new DVD, CD release, or cable network special to get new material from a popular comedian. But with Live at the Beacon Theater, CK is offering it on his website for just $5 with no digital rights management (DRM) restrictions.

Purchasing the special allows you to stream it twice in your browser, or download it twice as an unprotected MPEG 4 video file. Once downloaded, you can view the special as much as you want, put it on your smartphone, or even burn it to a DVD.

CK paid for the production and online distribution of the special himself, and he says that if this release goes well he may offer more content in the future. While it probably cost CK quite a bit to put this project together, he’ll likely recoup his expenses quickly since he doesn’t have to share the profits with anyone.

CK also preemptively asked his fans not to download the special illegally: “Look, I don’t really get the whole “torrent” thing. I don’t know enough about it to judge either way. But I’d just like you to consider this: I made this video extremely easy to use against well-informed advice. I was told that it would be easier to torrent the way I made it, but I chose to do it this way anyway, because I want it to be easy for people to watch and enjoy this video in any way they want without “corporate” restrictions.”

Filed under: media, VentureBeat

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