FarmVille maker Zynga planning to delay IPO

FarmVille maker Zynga planning to delay IPO

Summary: Maker of the popular Facebook game FarmVille, Zynga is planning to delay its initial public offering until the stock markets 'balance out'.

TOPICS: Banking, Legal

Zynga, the creator of the popular Facebook game FarmVille, is to delay its long-awaited initial public offering amid stock market concerns, the New York Post reports.

The company, which has been going from strength to strength, may delay its IPO until November, to allow the precarious stock markets to even out.

Sources close to the company report that its shares want to be listed as soon as possible, but Zynga is now "no longer in a rush because of the rocky stock markets". Instead, the company is looking past Labor Day for further clarity in making any firm decisions.

Zynga filed with the Securities and Exchange Commission (SEC) to raise up to $1 billion for an offering by early September. However, with turbulent stock markets and a still economically difficult time for investors in a post-recession climate, November is looking like a safer option for the Californian social gaming giant.

The SEC is also keen for Zynga to divulge more information on the fact that it relies on a small percentage of paying customers to support its continuing revenue model.

According to an amended filing, Zynga said that less than 5 percent of its total users -- estimated at around 250 million -- pay for products using the virtual cash model it employs in its games.

Since the United States was downgraded by credit rating agency Standard & Poor earlier this month, the stock market have been in flux. Microsoft, however, was reported to have maintained its AAA credit rating -- higher than the downgraded AA+ rating bestowed upon its parent government.

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Topics: Banking, Legal

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  • A good example of how not to design games for ongoing interest

    Maybe Zynga is afraid of imminent mass player exodus. It is fun to try to figure out why some online games get repeat business, and why some don't. The Zynga "Ville" games are good examples of wretched game design. The games are good looking, but do not reward long-term play. The pain level of challenges is unrelated to the quality of rewards earned, for instance. After a short while, all but the most dedicated player will get tired of banging their head against the wall and move on. Perhaps that is why Zynga keeps adding more games to its stable, hoping to keep players online just a little while longer.
    Tadd Peake
  • RE: FarmVille maker Zynga planning to delay IPO

    The bankers probably decided to pull the plug due to inherent risks with the market instability. They want to price it as high as possible to get the most from their fees so it's a pure power/money play. I bet they will do it mid-October and it will be a bit more solid from the start. To me it's still not a good idea to buy into but that's just me....I think it will go by the wayside like Myspace.
  • RE: FarmVille maker Zynga planning to delay IPO

    Yes!! Thanks for the info Get Farmville news here