The concept is simple: Users click to build houses, cows, and turnips, wait a few hours, and then click again for the same thing. According to the New York Times this formula has led Zynga, the creator of games like FarmVille, Mafia Wars, and CityVille, to be valued at nearly ten billion dollars. While many will debate the merits of these “social games,” it is clear that users are addicted to them. Zynga owns the top two most popular games on Facebook (CityVille and FarmVille) and has over 275 million users playing their suite of games on a monthly basis.
Investors see the link to Facebook as a potential issue, so the company has been signing deals with other social networks and has added their games to mobile devices in order to diversify their product offering. Zynga is also working on creating its own game site, called Zynga Live, and expects to launch it sometime in the middle of 2011.
It appears that technology companies are back in favor with investors. Zynga is currently working to secure $500M in financing, while Groupon recently received $950M, and Twitter secured $200M. Is this the dot-com bubble all over again, or are these companies fundamentally sound and ready to lead the next wave of tech giants?
Image Courtesy of TheNextWeb.com