This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at http://www.bbc.co.uk/go/rss/int/news/-/news/business-16214331
The article has changed 4 times. There is an RSS feed of changes available.
| Version 0 | Version 1 |
|---|---|
| Online games maker Zynga raises $1bn in flotation | Online games maker Zynga raises $1bn in flotation |
| (about 6 hours later) | |
| Zynga, the online games maker behind Mafia Wars and FarmVille, is to raise $1bn (£640m; 760m euros) on its US stock market debut. | Zynga, the online games maker behind Mafia Wars and FarmVille, is to raise $1bn (£640m; 760m euros) on its US stock market debut. |
| The company has priced its initial public offering (IPO) of 100 million shares at $10 a share. The price values the company at about $9bn. | The company has priced its initial public offering (IPO) of 100 million shares at $10 a share. The price values the company at about $9bn. |
| Its flotation will be the largest by an internet company since Google raised $1.9bn at its IPO in 2004. | Its flotation will be the largest by an internet company since Google raised $1.9bn at its IPO in 2004. |
| Founded in 2007, Zynga doubled sales to $829m in the first nine months of 2011. | Founded in 2007, Zynga doubled sales to $829m in the first nine months of 2011. |
| Unlike its main rivals, it does not charge for the actual games, but makes money by selling add-ons including weapons or extra characters. | Unlike its main rivals, it does not charge for the actual games, but makes money by selling add-ons including weapons or extra characters. |
| Market leader | Market leader |
| Zynga's other revenue stream is unique advertising, such as Starbucks paying to have a virtual coffee shop in CityVille. | Zynga's other revenue stream is unique advertising, such as Starbucks paying to have a virtual coffee shop in CityVille. |
| Users might have to visit that virtual store 10 times in order to build a Starbucks franchise in their own virtual cities. | Users might have to visit that virtual store 10 times in order to build a Starbucks franchise in their own virtual cities. |
| Stephanie Chang, research analyst at Renaissance Capital, said: "It's currently the leader in the social gaming space. It has 54 million daily active users, which is more than the next 14 game developers combined." | Stephanie Chang, research analyst at Renaissance Capital, said: "It's currently the leader in the social gaming space. It has 54 million daily active users, which is more than the next 14 game developers combined." |
| She also pointed to the company's exposure to an estimated 3% of internet users, which gave it advertising potential of $1.5bn. | |
| "That's a source of growth they haven't even tapped into yet," she said. | "That's a source of growth they haven't even tapped into yet," she said. |
| Facebook exposure | |
| Zynga publishes four of the top five games played on Facebook, and 95% of its revenue is generated from the social network. | |
| Facebook, which is itself expected to go public next year, takes a 30% cut of the revenue Zynga makes on its platform. | |
| But while its exposure to Facebook may be enticing to some investors, it could also pose a future risk. | |
| If Facebook's user growth slows, Zynga's growth is also likely to slow. | |
| Investors will want to see that the games maker can diversify and make money from other avenues. |