Zynga Files for $1 Billion IPO
Zynga has filed to raise $1 billion for their gaming company in an IPO. All Things D notes that this may be one of the largest IPOs of the year. Zynga plans to use the funds for things like game development and marketing, but also plans to use some of it for charities. The company came out of 2010 with $27.9 million in profits and $597.5 million in revenues. Zynga makes a lot of money through Facebook games, but Facebook takes a 30% cut of all money made through Zynga’s games on the social network.
Zynga’s games can be played for free, so the company’s profit relies on a small portion of users who are willing to pay for virtual goods in-game.