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Yet another Zynga executive jumps ship

Second resignation in two days, following numerous others over the past two months

Financial trends and news by Steven Loeb
September 19, 2012 | Comments
Short URL: http://vator.tv/n/2a48

I feel like I am in the movie Groundhog Day. Every day, it seems, I write the same story, over and over. I could bet money on any given day that a Zynga executive would be jumping ship and have a really good shot at winning my money back.

This time it is chief security officer Nils Puhlmann, whose Tuesday resignation was confirmed to VentureBeat on Wednesday. Vator has reached out to Zynga to independently confirm, but has not yet heard back.

This is the second report of a Zynga employee resigning in two days, after it was reported yesterday that Wilson Kriegel, the chief revenue officer of Omgpop, had left the company as well.

Back in August, Arvind Bhatia, an analyst at Sterne Agee & Leach, warned of an approaching “mass exodus” of employees from the company, following a 40% stock drop caused by a disappointing quarterly report that missed estimates.

Zynga had reported a loss of 3 cents a share on revenue of that grew 19% to $332 million, far short of analysts' expectations of 5 cents a share on revenue of $345 million. Zynga was also forced to reduced its forecast, dropping its full-year bookings to $1.15 billion to $1.23 billion. Zynga had previously estimated bookings to be $1.43 billion to $1.5 billion.

In response, Zynga tried to hang on to its workers by offering them company stock, specifically 43,295,554 shares, at prices from $2.53 to $2.97 per share, perhaps not understanding that it was the low stock price that was causing the employees to want to leave in the first place.

So, unsurprisingly, the gambit did not work, and a slew of Zynga executives and employees have all decided to leave in the last few months.

First was Zynga’s Chief Operating Officer John Schappert who resigned in August. No explanation was given, with the company saying in an SEC filing that the resignation was “not tendered in connection with any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.”

Then it was Chief Creative Officer Mike Verdu, who left in late August to start his own company and Alan Patmore, general manager of CityVille, who left to work at Kixeye.

Erik Bethke, general manager of Mafia Wars 2; Ya-Bing Chu, a VP in Zynga’s mobile division; and Jeremy Strauser, a general manager have all left as well.

Add to that the accusations that Zynga executives and investors engaged in insider trading when they sold their stock months before it crashed, and the lawsuit from Electronic Arts, who claimed that Zynga had plagiarized EA’s signature game, The Sims Social, with its new game, called The Ville. 

Zynga stock is currently up over 4%, trading at $3.21 a share, a far cry from its $10 IPO price in December.

(Image source: http://code.zynga.com)


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