Money money money
Social gaming giant Zynga is reportedly chatting with potential investors with an aim to raise around $250m in a deal that could value the start-up at over $7bn.
The three-year-old firm filed papers authorising the issuance of new stock, which meant the company was worth around $4bn in April, but new estimates could see the company's value rise to $9bn, The WSJ reported.
Facebook, Twitter and Groupon have all recently completed fundraising rounds, notching up their valuations and it seems like Zynga could be the latest to follow in their footsteps.
Although many gamers are critical of Zynga's gaming credentials, the firm reportedly recently launched CityVille (via Facebook) and built up a staggering 16 million users within the first month of its launch.
Zynga makes it money by selling virtual good attached to its games and uses social connections on Facebook to spread virally. The company is estimated to have around 275 million active monthly users across its titles, helping it to be $400m in profit last year, according to the newspaper.
As the company is already profitable and has no urgent need to raise cash, The WSJ reported that its source warned Zynga may decide not to go ahead with the deal despite the talks, which could equally be weeks away. The firm has reportedly already raised $360m from VC firms, without counting a mystery sum ploughed into its venture from Google.
Apparently Zynga has been approached by lots of investors desperate to grab a slice of the action, who reportedly reckon the firm will go public within the next couple of years, a prediction perhaps strengthened by the its appointment of investment banker Dave Wehner from Allen & Co as its CFO.
