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SEC filing submitted on Tuesday scant on specific details but likely points to acquisition price tag
Social gaming giant Zynga in late September sold $6.3 million in equity, according to an SEC Form D filing submitted on Tuesday.
Three unnamed investors participated in the funding. Coincidentally, however, the only three people not listed as “Executive Officers” under the “Related Persons” section are Brad Feld (managing director at Foundry Group), William “Bing” Gordon (partner at Kleiner Perkins Caufield & Byers), and Reid Hoffman (founder of LinkedIn and partner at Greylock).
The big question is what motivates the new funding.
One explanation, though unlikely, is that Zynga simply decided to raise $6 million. This won’t really make sense to anyone who has followed the startup lately, since Zynga is pretty notable for having recently raised hundreds of millions of dollars in investments from Google, Japanese telecommunications company SoftBank, and Russian investment firm Digital Sky Technologies. It seems like a waste of time (or a really bad sign) to raise $6 million less than half a year after such big fundraisers.
On the other hand, because Zynga checked “Yes” in field 10, which asks whether the “offering [is] being made in connection with a business combination transaction, such as a merger, acquisition or exchange offer,” it might be safe to assume that the stock sale has something to do with Zynga’s most recent acqusition of Bonfire Studios. How much Zynga paid for the Dallas-based game studio, which has simply been renamed Zynga Dallas, was not disclosed. But $6 million might be a good guess (and a good deal for the Zynga).
Buying Bonfire was just Zynga’s latest move in an ongoing, long-term acquisition spree targeting game studios and developers all around the world. In the last year, Zynga has acquired Dextrose AG (Germany), Conduit Labs (Boston), Unoh (Tokyo), Challenge Games (Austin), XPD Media (Beijing), and Serious Business.
Zynga has not yet responded to our request for more information regarding the funding.
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Zynga is the largest social gaming company with 8.5 million daily users and 45 million monthly users. Zynga’s games are available on Facebook, MySpace, Bebo, Hi5, Friendster, Yahoo! and the iPhone, and include Texas Hold’Em Poker, Mafia Wars, YoVille, Vampires, Street Racing, Scramble and Word Twist. The company is funded by Kleiner Perkins Caufield & Byers, IVP, Union Square Ventures, Foundry Group, Avalon Ventures, Pilot Group, Reid Hoffman and Peter Thiel. Zynga is headquartered at the Chip Factory in San Francisco. For more information, please visit www.zynga.com.