In April, Zynga CEO Mark Pincus sold 15 percent of his shares at $12 a share for about $198 million. By the end of July, the stock was below $3, the company missed second-quarter analyst expectations and sliced forecasts for the year roughly in half.
Employees holding restricted stock — those who remain after working through the brutal times leading up to the IPO and beyond — won’t be faring nearly so well, reports the San Francisco Chronicle.
I wrote before the IPO about the intense culture at the social game company — it reportedly aggregates performance data on everyone from the upper managers to the cafeteria staff and cuts those who don’t measure up.
Bloomberg reported that the company awarded stock options to all full-time employees in July in hopes of retaining them.https://o1.qnsr.com/log/p.gif?;n=203;c=204663295;s=11915;x=7936;f=201904081034270;u=j;z=TIMESTAMP;a=20410779;e=i
It quoted Arvind Bhatia, an analyst at Sterne Agee & Leach Inc. in Dallas, as saying:
It’s a proactive move to prevent mass exodus.
That stock’s valued at $2.53 to $2.97 per share, according to VentureBeat.
Meanwhile, the game maker’s in dire need of another big hit such as FarmVille. And adding to its woes, rival Electronic Arts is suing, claiming it copied EA’s Sims Social in making Zynga’s The Ville. And shareholders are suing, claiming it misrepresented business conditions by failing to announce a restructuring of its senior management team before the disappointing second-quarter report.
And despite the stock grants, its workers aren’t happy. The Chronicle says rank-and-file employees feel they’ve missed out on the riches that their bosses nabbed. It quotes one poster on the question-and-answer site Quora who claims to be a Zynga worker, saying:
I worked 100 hour weeks. Week, after week, after week. I hated the management. I hated the culture, but we all knew the IPO was right around the corner, and once it came, as long as the s- organization could keep it together for the lockout period, I'd have made bank, and in some way, that would have made my three and something miserable years there worth it.