I have to tell you that what stood out for me far more than cnet Don Reisinger’s November 10th article “Zynga to employees: Give back our stock or you’ll be fired,” was the comments it inspired and in particular the level of acrimony that manifested itself in statements such as the following:
“What would be worth the termination and perhaps even a couple of days in jail would have been to walk into Pincus’ office and kick his narrow, skinny ass from one end of the hall to the other then shove the offer letter up his @ss.”
For those of you who follow me both within this blog as well as on my radio show, you know that I strive to fully understand a situation from all perspectives and, thoroughly research the subject matter so that I am not merely offering an opinion but hopefully providing meaningful and worthwhile insight.
Even though I have just started to peel back the proverbial onion regarding the Zynga share recall, I felt compelled at this point in time to throw my hat into the comment stream ring by offering my two cents based on a prior knowledge of the company that has brought us Farmville.
While I will continue to do my reporting due diligence I had to offer, as an alternative point of view, what might very well inspire a similar degree of consternation on the part of Reisinger’s readers.
Here is the link to my November 2010 interview with VC Brad Feld regarding his new book “Do More Faster” which included references to Marc Pincus who in discussing Zynga Speed, jumped at the opportunity to write the forward for the new book because as he put it Do More Faster “is a concept that is close to my heart.” (http://www.blogtalkradio.com/jon-hansen/2010/11/05/from-farmville-to-mafia-wars-do-more-faster-is-the-ultimate-entrepreneuers-guide-to-success)
Keeping in mind that I have not concluded my research into the specifics of the request for shares to be returned meaning that at this point I can only comment from a conceptual versus factual standpoint, as an entrepreneur who sold his company at the height of the dot.com boom for $12 million (mostly shares and debentures) and made every effort to enrich the lives of those with whom I worked, I am not totally unsympathetic with Pincus and his executive team’s position.
Part of my initial reasoning is that as a founder of a company the risks associated with bringing a vision to life are significant, let alone succeeding to the extent Zynga has within the framework of what is a very difficult economy. This fact alone does warrant consideration because if the venture had failed, while employees would be out of a job, founders such as Pincus often times lose almost everything. In short a risk and reward consideration needs to be recognized.
Additionally, and unlike Groupon’s “Lefty” Lefkofsky who along with his wife personally pocketed $319 million of the $950 million raised in a pre-IPO round, the move by Zynga management does not appear to be geared towards enriching themselves personally but adding greater value to the company.
Again bearing in mind that I have not yet confirmed the details surrounding what I will refer to as the share recall, it appears that the returned shares will be used to attract more talent to help the company to continue on its success arc. If this is indeed the case, while some employees will technically “lose shares,” what they will continue to possess will ultimately have greater value.
If you are going to criticize Pincus and company on any point of contention, base it on an honorable but perhaps misguided and excessive generosity.
Conversely, for those employees affected by the recall, maybe they need to take a longer term view of where the company is going as opposed to what on the surface appears to be an attitude of entitlement that sadly for some may be fueled more by immediate greed than a common best interest of the company as a whole.
As indicated at the top of this post, I will provide you with regular updates as this story develops. In the interim, and as always, I welcome your feedback on what is likely to be the high tech gaming industry’s version of the financial market scandal’s that have rocked Wall Street.