Zynga, the online game company once touted as a hero of the Web 2.0 boom, is now almost a penny stock on Wall Street, down to $3 a share from its peak -- but CEO Mark Pincus escaped at least part of the damage.
Pincus, in an "unusual" move, sold 15 percent of his shares in April, with stock still holding at $12 a share, the San Francisco Chronicle reported. That netted the tycoon $198 million, some of which he used to buy a $12 million mansion in Pacific Heights, according to the newspaper.
Meanwhile, his other investors have lost half of their money, according to the newspaper. And how about the employees who built his company?
"Many rank-and-file employees who logged brutal work hours on the promise of Internet riches were - and are - staring at restricted stock worth far less than what had been expected," reported the newspaper, which dubbed Zynga a "cautionary tale."
"If Zynga doesn't stage a remarkable turnaround, it could end up as one of the most high-profile flameouts of the Web 2.0 era," the Chronicle warned.
Two Wall Street analysts dubbed Zynga's situation a "disaster," while the company says that people are merely growing tired of playing games like FarmVille and CityVille -- and spending less real dollars on the virtual goods in the games that were the company's lifeblood, the newspaper reported.
No Zynga employees commented to the newspaper.
Zynga In “Free Fall” As Execs Unload Stock
Zynga CEO Mark Pincus unloaded his stock before his company went south.
Copyright FREEL - NBC Local Media
