Words not for friends— Zynga, the game company that produces addicting online titles such as Farmville and Words with Friends has allegedly sent a memo to some of its employees who originally started with the company that if they don’t turn in their stocks, which were given to them through stock options, they’d be fired.
Donald Trump would be proud.
Why? According to Wall Street Journal sources, CEO Mark Pincus sent out the mandate to some of his original employees regarding the return it or get fired policy.
The San Francisco based game company has become a major force in online casual games since it started in 2007. Zynga is preparing for its IPO (initial public offering) sometime after Thanksgiving and will make its stock public for sale. It hopes to raise $1 billion in cash.
This sudden windfall for any shareholders of Zynga stock is undoubtedly going to reap some serious bucks, especially for early employees of the company who were offered stock options in the company. What happened? For startups, it is sometimes a good idea to offer lower pay with the offer of stocks in the company in lieu of higher salaries. This works well as the company and the employees have a vested interest in making the company successful.
However, in Zynga’s case, it may have doled out a few too many shares and the lucky employees who decided to buy up Synga stock will have a nice chunk of change if they sell their stocks.
In other words, the company became so successful that the undervalued shares they happily gave their employees turned out to be a gold mine.
Bad PR If the report by the Wall Street Journal is correct, it certainly sheds some unwelcome light on CEO Mark Pincus for being unfair at best and stingy at worst.
Our advice to the stock flushed employees? Be happy. Don't worry.
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Written by: Frank Ling on Monday, November 14, 2011 - 1:26 PM
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