Official: Google Has Invested In Zynga
Several sources confirm that Google invested a fee somewhere around 100 and 200 million US Dollars in Zynga company (which develops Farmville, FrontierVille, Fishville and Mafia Wars, played daily by an impressive number of Facebook users).
For those questioning the huge popularity of the games, I remind you that Firefox had to solve a bug of the 3.6.4 version just because the large number of users complaining they can’t play Zynga games.
Last year Zynga managed to raise half billion dollars for raising venture capital (in fact investment from companies interested in promoting business model), including $150 million coming from Softbank Capital and other $180 million from Digital Sky Technologies, Tiger Global, Institutional Venture Partners and Andreessen Horowitz.
The Softbank investment fee was never revealed, but it’s believed that Google was part of this transaction, being part of a strategic partnership.
I wouldn’t be surprised if Google Games uses Google Checkout (their own online payment service) instead of the famous PayPal, currently used by Zynga – which is PayPal’s biggest client – being a fact that Google is constantly searching for new ways of increasing Google Checkout’s market share.
But the details doesn’t stop here, the same sources saying that Zynga’s profit in the first half of 2010 was of about $350 million, with forecasts pointing towards $1 billion profit in 2011. The figures are way above what Zynga expected.
Zynga continues to search for some high level partnerships, reason why this kind of transactions are attractive for companies like Yahoo! and now Google. For some reason the users tend to get addicted to Zynga games, coming back and playing them every day, a fact that also helped Facebook in their ascension.
Companies involved in this transaction have declined to comment on these rumors, but Zynga’s IPO filing confirms that Googlge is among its investors.
Because Zynga already have such games on Facebook, MySpace and Yahoo, Google wants to somehow attract the company towards them, probably in an attempt to be a better rival for Facebook, with their brand new Google Plus.
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