Techcrunch says so.
Zynga
, the online gaming publisher, is making a ton of money. Just how much? Well, earlier reports put revenue at something around $50 million, but some new numbers obtained by Sarah Lacy suggests that it’s closer to $100 million. And clearly, it’s accelerating. We’re hearing that the run rate for 2009 may even be well above that.
So in case it wasn’t already clear, there looks to be a bright future in the online gaming sphere and specifically around micro-transactions. That’s how Zynga makes most of its money. With some of its leading games on MySpace and Facebook, it charges users for playing time or for things like chips in poker. These small purchases which usually amount to only a few dollars at a time, start to add up quick. And that’s only with a small percentage of overall players opting to buy them.
And Zynga recently transitioned this model to the iPhone, but because the iPhone doesn’t yet allow for in-app purchases, it has been forced to sell expensive versions of its apps like Live Poker, with chips included. But that’s about to change with the iPhone 3.0 software due this summer. The new software’s in-app purchases could very well take Zynga’s revenues even higher.
Just last week, VentureBeat’s Eric Eldon speculated that Zynga, which is now the largest Facebook app developer, might be trying to raise another large round of funding — something to the tune of $30 million. Given these revenue numbers — and yes, Zynga is already profitable as well — that certainly doesn’t seem out of the question. The company raised a $29 million round back in July of last year, and has raised $39 million total.
If Zynga is doing $100M in revenues and is profitable why would they need to raise $30M. This doesn’t add up.
Update: BW has a featured article on Zynga. It looks like there is a calcualted PR campaign going on in preparation for fund raising.
Profits from corporations are usually minute fractions of their income.
Comment by Beer — April 30, 2009 @ 1:32 am
Hmm, companies such as Zynga can be run lean and efficient and have decent margins.
Comment by Raja — April 30, 2009 @ 7:23 am
I sense a pattern.
You’re about as wrong here as you are wrong here:
http://www.rajajasti.com/2009/03/06/calling-bs-indie-facebook-developers-making-700k-a-month/
For people in the know, Zynga’s numbers have been common knowledge for a few months now.
Comment by Insider Developer — May 1, 2009 @ 11:00 am
They may well be making $100M in revenues (there is no way for anyone to know for sure as they are a private company). But things don’t add up that they are profitable but yet want to raise $30M. That’s what I am calling BS on.
Comment by Raja — May 2, 2009 @ 8:27 am
Hey everyone, my name is Blake. I have been an employee of Zynga for three months now. I have nothing but positive things to say about Zynga; and nothing but sincere respect for the individuals who make the operation possible. I got a job with Zynga shortly after graduating from UC Davis (studied Economics).
I was hired as a contract employee to perform various tasks for the iphone team. I was stoked just to land a gig in this job market - not to mention I had been an avid gamer since duck hunt. Looking back, I guess I have been a social gamer all along.
What excited me even more was my first day on the job. I walked into an office buzzing with energy and inspiration. I got the vibe that everyone had specific roles to fill for an ultimate goal - and if they could do that, they would be compensated fairly. We all felt very appreciated.
My initial tasks were somewhat remedial, but I enjoyed doing ANYTHING in the office because of the atmosphere. I also knew that how minor the task may seem was irrelevant. The most important tasks could not be completed without the building blocks. I always tried to exceed expectations and never put my name on something that wasn’t my best work. One day, I was asked if I wanted to make a game-demo video for the upcoming release of Scramble Live. Remembering a time during my childhood when Chad (my neighbor) and I would try to write down EVERYTHING you had to do to beat Donkey Kong, I accepted the task. I had already played a LOT of Scramble in preparation for launch, so I had a plethora of ideas to communicate the games features. I finished the video, editing included, in about 4 hours. Most of the shots were just one take. It turned out that the casual, one take, approach fit with Zynga culture. Shortly after the first video, I took up the alias ‘1 Take Blake.’ Truth be told, I’ve ALWAYS wanted to be involved in the film and entertainment industry. I was able to blend my passion for film making with my addiction to video games. All the while I was getting paid to do what I love!
Since then, I have made 4 more videos for Zynga - and really feel like they are appreciated. My goal is to make a video for every department of Zynga - really focusing on the team dynamic. I love to include my co-workers in my work, because without them, I would not be doing it. I wake up every day grateful that I am living the dream.
I aspire to be Zynga’s go-to guy for video and other creative media needs. I am proud to say I am a Zynga employee, and also believe that everyone is entitled to their own opinion. I guess it is not abnormal that bad press about companies seem to correlate to their level of success. There will always be haters. I accept that. I have always worked my ass of to reach success while maintaining my integrity. I can sleep at night comfortable with every decision I have ever made. Despite that, I have never gone a week without hearing somebody else’s negative energy. ‘Blake, you can’t do that because…” or “It’s impossible to reach THAT level of sucess without sacrificing your morals.” I shrug it off. The recent wave of negative press about Zynga - in a way - feels like an accomplishment. I realize that when society does not understand something, they will form speculations. Go ahead everybody, speculate about how Zynga continues to expand; continues to build out new departments and positions (like mine); and to remain profitable. I guess we just figured it out before the rest of you. But please RESPECT our business. We will always respect yours. We will continue to connect the world through games. They are fun as heck, you should try them! And smile.
Anyone and everyone is encouraged to link up with me online. You can friend/message me on facebook. You can follow me on Twitter (One Take Blake)
BUT!!! Please do not waste your time sending me Zynga hate mail. It will be deleted/marked as spam immediately. I am open to conversation with any open mind. I know that (deleting the messages right away) might be perceived as close-minded. But I just don’t have time to deal with people who have their mind made up on something I don’t agree with. I have way too much FUN work to do!
Mark Pincus - Thank you, from the bottom of my heart, for making this possible. Rather, making it possible for US to make this possible.
Email me at blake@zynga.com OR 1takeblake@gmail.com
iPhone Mafia Wars
Level: 180
Mafia Size: 168
Hourly Property Income: $1,352,415
Attack Power: 2433
Defese Power: 2581
Friend Code 7501 4350 66
I also play YoVille (YoBlake), Guild of Heroes, Scramble, Live Poker, and Vampire Wars. (But I would accept a challenge to ANY Zynga Game!)
Brutally Honest,
Blake Loftus Jamieson
Comment by Blake Loftus Jamieson — May 3, 2009 @ 2:25 pm
Hi Blake,
First of all, congratulations on finding a job you love. Also thanks for taking the time out to share your experience and feelings about Zynga on this blog.
I want to clarify something. I am not calling BS on Zynga. I am just calling BS on the rumors that Zynga is looking to raise $30M eventhough they are profitable. Marc Pincus is a very smart and experienced entrepreneur, so I am sure he knows what he is doing. This is all the more reason for me not to believe in the rumors.
You are lucky to find a job like this right out of school. You will learn a great deal that should stand you in good stead in your career. Wish you all the best.
Raja
Comment by Raja — May 3, 2009 @ 5:47 pm
Raja: if that’s the case, then perhaps consider changing the title: “Calling BS: Zynga making $100M”?
Comment by Insider Developer — May 4, 2009 @ 4:38 pm
OK. Done.
Comment by Raja — May 4, 2009 @ 11:26 pm
da best. Keep it going! Thank you
Comment by KrisBelucci — June 1, 2009 @ 6:10 pm
This Blake guy is a tool. His email above is a cut & paste that he has slapped on a number of different blogs where Zynga is mentioned. I think his job is to be a Zynga dancing monkey, making videos about how sweet it is at Zynga and how their segways rock or something.
Comment by DPH — August 25, 2009 @ 8:24 pm
why wont my poker load then if you work for zynga you should have all the answears?av up graded flash player and every thing .why carnt yous just stick to the way it used to be cos theres lots of people geting fed up now and might just never go back on to it if it doesnt get sorted out soon?have you any advice?
Comment by grant marshall — October 5, 2009 @ 10:16 am