The original rumour is that Zynga was going to go public the week before Thanksgiving. Since then, the big day has been pushed past turkey day and is said to be coming before the end of the year. What’s going on? Despite all the hype surrounding the company, Zynga may not be ready to go public just yet, as suggested byits latest quarterly results.
Let’s take a look at five reasons why Zynga may be waiting … and what it has to do about them:
1. Something to prove: Zynga is asking the investing public for $1 bn. One billion dollars. To get it, the social gaming company will have to demonstrate that it’s deserving. So far, that’s a tough one.
2. Say something: Zynga is remaining tight-lipped as to its strategy, according to AllThingsD. While this may work for a private company, investors will want more information. Staying silent doesn’t help.
3. Do something: despite having announced 10 new projects, AllThingsD continues, none has launched yet. For a blockbuster-driven company, press conferences aren’t good enough. Nothing beats having users sign up and transact in virtual goods (well, for Zynga, at least).
4. Do more: the company has been slow to release new games this year, a fact that is reflected on its income statement. Zynga needs to fill up the pipeline (or show that it has).
5. Spend less: it worked for Groupon, and it may work for Zynga. Groupon cut marketing spend in order to improve its margins, and this plan, if investors buy it (they did for Groupon), would help solve the problem of higher revenues coming at disproportionate expense.
Photo: ftchris via Flickr