Zynga: How the Former Social Gaming Darling Fell From Grace

It seems that Zynga never really developed a sustainable business model and this failure is the company's ultimate undoing.

I’m sure we all remember when our Facebook feeds were overrun with Farmville and Mafia Wars. Personally, I was glad when they went away. Zynga, of course, is the creator of the once prolific aforementioned social games.

While Zynga was once heralded as an innovator in gaming business models, it looks like the business model may have actually been a flop.

According to Ars Technica, the former social gaming darling is in trouble to the tune of  $600-million in losses since 2008. “In interviews with current and former Zynga employees, a picture emerges of a firm that underwent an astonishing rise but soon found itself sagging under the weight of over-management, missed opportunities, and the lack of a real long-term vision,” the article says.

The article describes in great detail the events leading to Zynga’s current state as a social gaming “has been.” From licensing games exclusively to Facebook, which summarily scrubbed Zynga games from the newsfeed because of the Zynga “spam mechanism;” to philosophical differences with developers who wanted to make the games fun.

It seems that Zynga never really developed a sustainable business model this failure is the company’s ultimate undoing. Indeed, if the purpose of a startup is to search for a business model, Zynga may well be a startup on the verge of collapse.

After a scathing report of the mistakes that could be Zynga’s undoing, the Ars Technica piece ends with a telling quote from Gartner Research Analyst Brian Blau: “If they can figure that out, I think Zynga will be fine, given the trajectory…Last week, I would have said I was despondent, but now, after the [June and August 2013] layoffs, I would say I’m cautiously optimistic.”