December 22, 2011
Zynga is out with its IPO at $ 9.5 per share with total market capitalization of the company around $ 7 billion. The Zynga model we had prepared when it filed the S-1 with SEC some three month back, had indicated a price of $ 9.6/share which was quite on the lower side when compared with the market expectations.
Apart from discussing the major turnoffs for the equity investors, we had also emphasized on the importance of good relationship with the Facebook for Zyngaâ€™s health. I think the success of Zynga at least for now is completely dependent on the health of Facebook. So everything boils down to good relationship between Mark Pincus, a Harvard graduate and Mark Zuckerberg, a Harvard drop-out. Perhaps thatâ€™s the reason Mark Pincus has secured most of the voting rights with him. Letâ€™s dig deeper and see the detailed share holding structure of Zynga.
|Share-Holding Structure of Zynga|
|Class of Shares||Voting Rights/Share||% of Shares Holding||% of Voting Power|
|* Class C shares get a surprising 70 votes per share fully owned by the CEO Mark Pincus|
Now the question arises whether Zynga is playing a fairgameVille with the Class-A equity holders or is it in the mood of playing Mafia Wars with the shareholdersâ€™ facebook credits?
The shareholding structure above clearly tells us the answer!!
You can view the entire summary of the share holdings here.