Zynga Founder’s Early Biography
During his early childhood living in Chicago’s Lincoln Park, Mark Pincus has been doing treasure hunting games when it was still played around the family table. Mark had an architect mother and a father who runs a public relations firm. Mark is the only boy in the family and a middle child with two sisters. His mother would recall that although there were competitions among her three children, Mark would still think his own way.
Mark Pincus also didn’t forget what his father said to him, “If you want to do something, really go for it, [and] be all in.” It’s a lesson that stayed with him later in his career. Pincus worked as a financial analyst in New York after graduating from University of Pennsylvania’s Wharton School of Business. He later took an MBA in Harvard.
The Essay that Earned Him an Interview with Fred Wilson
After finishing MBA, Pincus moved to Washington DC and found himself in a career crossroads during the Internet boom. He recalled that, “I walk up in the middle of the night, it was 1994 and I couldn’t sleep.” Keeping him awake was the introduction of MOSAIC Communications, the world’s first internet browser.
With the coming of MOSAIC Communications, Pincus also spent the rest of the night writing an essay about the future of the internet where he envisioned this new company would displace the giant Microsoft and become the next major platform of the world.
Pincus said that that essay earned him an interview with Fred Wilson, a young venture capitalist looking for great ideas. Fred told him that if he wanted to pursue one of those ideas that he had written, he’ll loan him $250,000 for four months. “It’s a demand… and during that time it’s one of the riskiest things to do,” according to Pincus.
Mark Pincus took the money and used it to start a website company called Freeloader where he became its President and COO. According to Pincus, Freeloader purpose was to create a tool that is attached to a browser that let someone subscribe to any contact they like on the Internet.
Internet during that time was not as fast as it is today and as a result, the content of Freeloader needed to be downloaded for a longer period of time—a situation in which Pincus and co-founder, Sunil Paul, seldom did. Paul would also recall their experience as, “the hardest in terms of the number of hours that I’ve ever work on a start-up. It was so hard [that] it’s un-sustainable. I mean you can’t work seven days a week more or less continuously forever.”
Because of the owed investment, both of them have four months to get Freeloader into the market in order to prove that the start-up was viable. Added to it was the fact that they also need to raise more venture capital money or bring in revenues to support themselves.
Freeloader Acquisition Increases Mark’s Net Worth
The demanding schedule of putting together their first website paid off. In 1996, Individual Inc. bought Freeloader for $38 million mostly in company stocks. Mark Pincus received an amount of $7.5 million, according to a Washington Post news during that time.
After he sold his first company, Mark Pincus’ mother asked him if he wanted to retire and Mark said to her that, “Why would I retire? It’s what I do. It’s who I am.”
Becoming a new partner of Individual Inc., Pincus joined the Freeloader team in San Francisco, California but after a year, the company that he had founded folded up when management problems tore apart its parent company, Individual Inc. Pincus recalled that it was, “a painful stagnation,” for the two of them.
With the shutting down of Freeloader, Mark Pincus—now a more determined and restless entrepreneur—started a new company called Support.com. According to him, the start-up was about a service that would remotely diagnose and fix computer problems.
In the middle of the dotcom and consumer explosion, Mark would recall that the start-up was the “most boring enterprise software company the world has ever seen.” He said that he couldn’t even make venture capitalists get interested with his project and they would cut the meeting short with him.
His new start-up wasn’t the vision of an Internet treasure that he wanted but it was a springboard to getting to his dream. It was also the time when Napster, a music sharing website founded by Sean Parker, became the hottest Internet start-up in Silicon Valley. According to Mark Pincus, Napster was, for him, the beginning of the social web that people are now building or using.
Since the website was all about sharing, it was the first time people looked at their computer were allowed to “surf” the Internet to check out other people.
Founding Tribe.net and Investing in Friendster
Mark Pincus also met someone who agreed with his ideas, Reid Hoffman, a serial start-up investor who became Paypal executive and now LinkedIn founder. They’ve both realized how internet empowered people and both invested on another start-up social networking site, Friendster, and started hanging out and trading notes.
Friendster, after its launch, took off like a rocket and millions signed up for the new social media network. Mark Pincus and another friend, Paul Martino, wanted to stretch the idea further and founded another social networking site of their own called Tribe.net.
According to Paul Martino, Mark spotted how important Friendster was even before the company CEO did and Mark told him that online social networking will change everything that people do online.
However, several problems were encountered by Tribe. One is that the site was overwhelmed by fans of the annual festival in the Nevada desert called the Burning Man. Mark Pincus is a huge supporter of this festival, which is an inclusive community who go to the desert and showcase their inner freak out, and Pincus probably never thought that it will cross on his business model.
Some people attending the festival were sharing a little too much, including some naked guys uploading images of themselves on the website. Mark later recognized that it didn’t work out and Tribe.net was soon weathering and losing money. To make matters worse, it was also the time when MySpace was on its way to becoming a social networking site giant. After that, Tribe became his third start-up to fall short of his great expectations. That disillusioned Mark and made him rudderless.
It was also the time when he met Anthony Robbins whose message still resonates on his head, messages like: “people can write their own story and the stories that they wanted to write… owning their own destiny and outcome and not being a victim.”
With nothing to do and a lot of time on his hands, Pincus got hooked on online games like Rise of Nations. He became addicted to it and spent hours playing, which according to him affected his relationship with other people but eventually got him thinking how to earn money playing games.
Mark Pincus Creates Zynga for Facebook
It was also during that time when Facebook founder, Mark Zuckerberg, made an announcement that would change Pincus’ life. Facebook started to unveil their new platform that let other developer create application that can be integrated to the giant social networking site. Pincus, during the unveiling, had a light bulb moment which as he recalled was, “I could offer games as a way for people to socialize and I don’t have to build a social network.”
Mark Pincus’ fourth attempt on a start-up was a charm, he had finally hit on his big idea. He named the start-up in honor of his beloved American bulldog pet, Zynga. Texas Hold’em Poker was the first Zynga game that his company developed.
At first, Mark and his team wondered if there were people who wanted to play the game but then the game’s viral nature took off and over time, online players just “snowballed”—as his mother remembered.
The game was free and income came from ads on other Facebook applications. Pincus who keeps a mantra, “I want to be the biggest in the social game. I want to be the one who believes in it more. Believes in play more and invest more in that than anyone else,” moved quickly to raise Zynga higher. He also moved to look for outside investors.
Mark Pincus’ plans were that he would be building it for long term operations and refuse to sell it. He would also be the controlling shareholder and board member and an equal partner with his investors.
With Pincus’ uncompromising reputation, investors invested about $29 million in cash on Zynga. But Zynga’s next hit game, Mafia Wars, came under attack when the game developer of Mob Wars filed a copyright infringement suit because of its similarity to their game. Zynga eventually settled the lawsuits for an undisclosed amount.
When Zynga released Farmville, another accusation also raised concerning the game because of its similarity to another game that was released months ahead called Farm Town. Pincus disputed the copycat charges, claiming game mechanics were not copyright protected.
Zynga attracted millions of users through its unique offerings and features—one of them is the virtual goods. Pincus believes that other gamers like him would be willing to pay to get ahead in a game. Cash cow in Farmville is one of them, pushing Zynga to be the United States’ biggest online game operator.
Even with the success of Farmville, Mark Pincus faced yet another controversy when TechCrunch, a technology blog, released a 2009 video of him speaking to a group of entrepreneurs, saying that he, “Build every horrible thing in the book just to get revenues.”
It was one of the biggest mistakes that Pincus made in his career. He put himself at odds with the whole distinctive spirit of Silicon Valley, which is “build a great product first and then figure out how to make money on it.” Mark, however, stated that during the whole talk, he was just trying to make a point to the audience about how consumer internet companies can have big revenues and be profitable and not just be about eyeball and all the things horrible about the dotcom bubble.
Zynga’s phenomenal growth was largely because of Facebook, which provided about 90% of its revenue through ads. But Zynga lost millions of users when the non-players of Facebook started complaining and requesting the social network website to allow its users to have control on the gaming applications.
Facebook founder, Mark Zuckerberg, also wanted to have a share on the millions of dollars being controlled by Zynga. According to Pincus, no company has ever done what Facebook have done before. He said that it was nothing more than an online click through agreement on Facebook who opened up their entire network of users to any company in the world.
But Pincus was more at risk because if it loses Facebook as a platform, it could be the end of Zynga. According to him, the two companies face a real decision on whether or not they’re gonna double down on each other or diversify away. Later on, Zynga and Facebook would come up with an agreement to double down because they both saw that it was on their user’s interest.
Zuckerberg and Pincus also announced a five–year strategic relationship. Added to it was the agreement that Zynga would pay 30% tax on virtual products that it sold through Facebook.
With more income coming in, Zynga also bought several companies such as Newtoy Inc., Challenged Games, Floodgate Entertainment, and Area/Code among others. By December of 2011, Zynga went public with a $7 billion valuation and with Pincus retaining much of the company voting power.
The 2012 first quarter report of the company showed that it was spending more on R&D and on games than it was putting out, added to it was the fact that users were not staying. Much of its growth came from an area where Zynga wasn’t spending the majority of its R&D money—mobile games.
Zynga Faces Infringement and Insider Trading Accusations
Also Zynga’s growth on the web slowed down and the transition to mobile surprised them as well as others and eight months after its initial offering, the company lost more than 70% of its value. Bad news also kept on coming including leaving of several key executives, like Alan Patmore and Eric Bethke. The company was also hit with several lawsuits for copyright infringement and insider trading.
The Facebook IPO also became a big fizzle that in turn dragged Zynga down along with it because the company’s majority income came from Facebook.
Despite the big decline that Zynga experienced, Pincus continued to work hard as he always did, announcing plans for new games, focusing on mobile applications, and moving into real money gaming.
Mark Pincus married Alison Gelb, who is also an internet entrepreneur and founder of One Kings Lane, an online décor company that offers steep discounts to its paid members. The couple is currently living in San Francisco with their twin daughters.
Mark Pincus as an extraordinary person have always had a passion to become big in whatever endeavors that he takes on. He even said that, “I think that the truth is written over a long period of time. I’m in this for the long run and I’m looking for other people who are too.”
- Zynga Inc.
- Floodgate Entertainment
- Wild Needle
- Digital Sky Technologies
- L’École de Choix (Haiti)
- Save the Children Earthquake Emergency Fund
Awards and Achievements
- 1995: Started Freeloader
- 1997: Founded SupportSoft Inc.
- 2003: Founded Tribe.net
- 2007: Founded Zynga
- 2010: Crunchies Award Founder of the Year