Zynga Is Said to Lose Three Top Executives This Month
Stock Chart for Zynga Inc (ZNGA)
Zynga Inc. (ZNGA) has lost three top executives this month, people familiar with the matter said, increasing the number of managers who have exited the struggling social-games developer.
John Osvald, a senior vice president of games, Jesse Janosov, a vice president who ran Zynga’s casino division, and Nathan Etter, a vice president of games, all resigned this month, said the people, who asked not to be named because the departures aren’t public. Etter left to take a job in the interactive division of The Walt Disney Co., according to his profile on LinkedIn Corp. (LNKD)’s website.
The exits follow the appointment this month of Microsoft Corp. executive Don Mattrick as Zynga’s chief executive officer, replacing founder Mark Pincus. The departures are the latest of more than a dozen top managers who have left since the company’s December 2011 initial public offering, as waning demand for Zynga’s games on Facebook Inc. (FB)’s network has sent the shares down more than 70 percent, eroding the value of equity-based compensation.
Stephanie Hess, a spokeswoman for San Francisco-based Zynga, declined to comment on the personnel changes.
Zynga fell 1.7 percent to $2.97 at the close in New York.
At the time of its IPO, Zynga was the largest maker of games played on Facebook, with popular titles such as “CityVille,” “FarmVille,” and “Mafia Wars.” The IPO raised $1 billion, the biggest debut by a U.S. Internet company since Google Inc. raised $1.9 billion in its 2004 IPO, according to data compiled by Bloomberg.
Since then, Zynga has lost traction on Facebook amid competition from startups such as King.com, developer of “Candy Crush Saga.” Earlier this month, King displaced Zynga as the top maker of games for Facebook users. At the end of the second quarter, Zynga had three top-10 titles on Facebook, down from seven a year earlier, the company said last week.
Zynga, founded by Pincus in 2007, makes money from selling players virtual goods for its games, such as a tractor in “FarmVille.”
Mattrick is working to revive growth and reinvigorate Zynga’s efforts in mobile games, where it has failed to produce a lasting hit. The company expects two to four quarters of “volatility” as he evaluates the business and product line and develops a new strategy, he said on a conference call last week.
“We are missing out on the platform growth that Apple, Google and Facebook are seeing,” Mattrick said on the call. “We have the ability to break some bad habits and get back to some good fundamentals.”
Osvald and Etter joined Zynga in 2009, when the company was growing rapidly and the popularity of games such as “FarmVille” was rising. They both helped lead the group that produced “FarmVille.”
Janosov led casino games, such as “Zynga Poker” and “Zynga Elite Slots,” in which users gamble virtual money. The company last week withdrew its application for a license to enter real-money gambling in the U.S.
Zynga is increasingly competing with its own former executives, many of whom have left to found mobile-gaming startups. At least six companies have been created by former Zynga employees, including Bee Cave Games Inc., JuiceBox Games Inc., and TapZen Inc.
Top managers who have departed since the IPO include Mike Verdu, the former chief creative officer; Brian Reynolds, the former chief game designer; marketing head Jeff Karp, and former chief financial officer David Wehner.
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