In April 2007, Mark Pincus founded a software development operation called Presidio Media. Within the next three months, he rebranded the company “Zynga” after his deceased pet, an American bulldog named Zinga, and made the canine their corporate logo. After signing a contract with Facebook in July, Zynga released “the dog’s” first online game—Texas Hold’em Poker.
Who could have possibly imagined what would happen next? Just a few years later, that simple start would lead to the biggest online gaming network in the world, with 232 million monthly active users, and a dominant position among all free-to-play poker networks on the Internet.
Change Happens at Light Speed
Zynga was helped along by a timely venture capital injection. In 2008, angels dropped $29 million on the company, allowing it to purchase YoVille, a virtual world network game that was already entrenched on Facebook. Soon, “addictive” social networking games were being introduced one after another and users simply couldn’t get enough of them.
So phenomenal was Zynga’s rise from nowhere that Fortune magazine remarked in a 2009 headline, “Zynga suddenly is everywhere. What gives?” In 2011, the little bulldog followed LinkedIn and Groupon as one of the most highly anticipated IPOs of the year. The company’s initial valuation was just shy of $9 billion. Today, Zynga is traded on Nasdaq and lists among its brands Farmville, Mafia Wars, FishVille and Words with Friends, to name a few, accounting for an estimated 60 million active users every day.
The diversification of Zynga’s games has in no way hurt the popularity of its original poker offering. Now supported by some 31 million registered “Zynga Poker” players, the five-year-old network has all but monopolized the world of social poker, leaving its rivals far, far behind. By comparison, the closest poker-purveying competitor, International Gaming Technology, counts just seven million subscribers within the Double Down Poker network, which it obtained through acquisition in January of 2012.
Secrets of Success
No doubt Zynga started with a good poker product. Players may choose their own tables, interacting with opponents from around the world or joining friends for a game. They can play at casual Hold’em tables, participate in tournaments or opt for VIP sessions. There is a leader board indicating how players compare in the chip rankings, and a gift shop enables personalization and decoration of seats at the table. Chat windows, challenges, gifting and incentives add to the fun.
Marketing was also one of Zynga’s early strengths. In March 2008, the company added a way to “sell” virtual merchandise via lead generation. Users were offered poker chips in return for participation in revenue-generating activities for Zynga, such as accepting offers to register their Facebook “friends” for other products or services.
For a time, Zynga Poker was also available on MySpace and Yahoo, where it reached several million more players. But both platforms were dropped in early 2012, stemming from a decision to concentrate on a single core market. Two years earlier, Zynga and Facebook had agreed to a five-year strategic relationship that increased their shared commitment to social gaming and expanded use of Facebook Credits in Zynga’s games. One might say that Pincus decided to “follow the money.”
What Lies Ahead
According to AppData, Zynga Poker is currently holding its position as the fourth most popular game on Facebook. It is also available on Google Android and Apple iOS. In fact, Zynga Poker has been among the top-10 grossing games in the Apple App Store for many months now, further adding to the company’s dominance of the virtual realms of social poker. To grow its base further, Zynga is introducing a complimentary casino-type game, Zynga Slots, but no new versions of the poker software have been announced.
About the only jewel missing from Zynga’s online poker crown is a tie-in with a real money poker network. The rumor mill hints that could be the very next step, especially in light of recent ownership changes on Facebook, such as IGT’s acquisition of Double Down. In much the same way, Caesars Entertainment recently purchased Playtika, an Israeli social gaming company, for $170 million. Playtika is the force behind Slotomania, one of Facebook’s most popular games, and the Las Vegas company has made no secret of its interest in online gaming for cash, including virtual poker rooms.