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How is Zynga supposedly worth over 20 times what PopCap is being bought for? I must be massively underestimating how much people spend on in-game items in * Vil

How is Zynga supposedly worth over 20 times what PopCap is being bought for? I must be massively underestimating how much people spend on in-game items in * Ville\* Wars. Or really overestimating how many copies of PvZ have been sold (I've bought it twice). And PopCap's revenue model isn't even almost wholly dependent on another companies success.

alanfalcon 15y ago
That's how successful the Freemium/Facebook model has been, and describes perfectly where investors think the market is going.
kin 15y ago
Question: How old are you? I'm 23 and after entering the social gaming industry as a developer, the numbers are actually incredibly surprising. I'm talking like... several hundred thousand buckaroos a day from a single game, all from the same market of middle aged stay-at-home/desk-job women.
- endlessvoid94 15y ago
  Yep, most people have no idea how much money is in this space right now. Real money. Coming from users. It's enormous.
- bersekro88 15y ago
  buckaroos? How much does that transfer over to USD?
  - ericwan 15y ago
    i believe it is 1 to 1
newobj 15y ago
You are massively underestimating. Zynga did $500M revenue in 2010 and PopCap did $100M.
- InclinedPlane 15y ago
  PopCap's games are extremely well known and particularly suited to mobile platforms like phones and tablets. If anything I'd say EA bought them for a steal, they are likely to earn back their buying price and more in only a few years.
  - newobj 15y ago
    Sounds like it's about a 10x revenue buyout. Seems right on the money.
Impossible 15y ago
It's mostly hype surrounding anything social right now, especially with a good revenue model. Zynga is worth 4x what EA is and currently worth more than EA and Activision combined. There is a lot of money in social games, but without getting a lot more users (hard when CityVille is hitting 100 million+) or getting much better conversion rates, Zynga is unlikely to see revenue from social games that matches their current value.

alanfalcon 15y ago

That's how successful the Freemium/Facebook model has been, and describes perfectly where investors think the market is going.

kin 15y ago

Question: How old are you? I'm 23 and after entering the social gaming industry as a developer, the numbers are actually incredibly surprising. I'm talking like... several hundred thousand buckaroos a day from a single game, all from the same market of middle aged stay-at-home/desk-job women.

endlessvoid94 15y ago
Yep, most people have no idea how much money is in this space right now. Real money. Coming from users. It's enormous.
bersekro88 15y ago
buckaroos? How much does that transfer over to USD?
- ericwan 15y ago
  i believe it is 1 to 1

newobj 15y ago

You are massively underestimating. Zynga did $500M revenue in 2010 and PopCap did $100M.

InclinedPlane 15y ago
PopCap's games are extremely well known and particularly suited to mobile platforms like phones and tablets. If anything I'd say EA bought them for a steal, they are likely to earn back their buying price and more in only a few years.
- newobj 15y ago
  Sounds like it's about a 10x revenue buyout. Seems right on the money.

Impossible 15y ago

It's mostly hype surrounding anything social right now, especially with a good revenue model. Zynga is worth 4x what EA is and currently worth more than EA and Activision combined. There is a lot of money in social games, but without getting a lot more users (hard when CityVille is hitting 100 million+) or getting much better conversion rates, Zynga is unlikely to see revenue from social games that matches their current value.