Today, the New York Times posed a question about the wildly successful Facebook game developer, Zynga: “Will Zynga Become the Google of Games?”
It wasn’t so long ago that Sergey Brin and Larry Page were scrapping together servers from spare parts to build what would become the most successful search engine in the world. Nor, was it so long that Mark Zuckerberg dropped out of Harvard to work full time on a social network that would gain over half a billion users.
In maybe three or four years Mark Pincus, founder of Zynga, will realize NYT’s vision of becoming the “Google of online games.” Founder of popular Facebook games, Mafia Wars and Farmville, that vision could not be that far out of reach.
Unlike other hot Silicon Valley startups, like Twitter, Zynga is highly profitable. The online game developer will bring in over $500 million in revenue this year, according to Inside Network, through small user payments of virtual goods. How did the online game company reach half a billion in revenue in only three years?
Here are several entrepreneurial lessons we can learn from Zynga and other Silicon Valley superstars:
Believe What You’re Doing
When Mark Zuckerberg launched Facebook (then The Facebook) from his Harvard dorm room, not even he could have imagined amassing over half a billion users. But he believed in creating the social platform enough that he eventually dropped out to pursue his entrepreneurial dream. Steve Jobs was booted from Apple in the late nineties due to internal conflicts, but he revived the failing company when he returned several years later. Mark Puncus entered an unexplored space (Facebook apps) with full force and that vision of what the company could be carried him, Steve Jobs and Mark Zuckerberg to the success they have today.
Be Able to Scale Quickly
Zynga, like many other successful Silicon Valley entrepreneurs, grew exponentially in a very short amount of time. For entrepreneurs to scale their company quickly they need to build in internal growth strategies into the overall entrepreneurial vision. Zynga, for instance, grew to 1,000 employees, up from 375 a year ago, and now has around 400 job openings. Zynga’s internal structure of the company lends itself to fast, scalable growth.
Build Momentum Off of Early Success
Early successes can be the spark that sets the business to eventual profitability. Don’t let that spark fizzle by ignoring potential opportunities. For instance, Zynga started off with one game, then used early successes as a cue to build an entire suite of Facebook apps. By building off this early momentum, Zynga has undoubtedly become the market leader of Facebook apps. But as Mark Puncus adds, it’s only the beginning. He’s going to use the initial success of Facebook apps as a stepping stone to become the “Google of gaming.”
Raise Money, Even When You’re Profitable
There is sometimes a misconception amongst early stage companies that you need funding when the coffers are empty. Not true. Businesses can always use funding to take their strategic vision to the next step. For Zynga, although the company is estimated to generate $500 million in revenue this year and is valued more than $4.5 billion, it has still obtained $520 million in funding — from investors including Google and Netscape founder Marc Andreessen.
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