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Angry Birds dev turns down Zynga $2.25B buyout offer - Report

Rovio said to walk away from billion-dollar deal with FarmVille maker due to reputation of oppressive working conditions.

More so than any other game company, Zynga has capitalized on the ballooning popularity of casual online games, thanks to breakout successes like FarmVille and Mafia Wars. However, the New York Times reports the company's success has been fueled by harsh working conditions, and it may cost the studio in the long run.

Sourcing a handful of employees speaking under the condition of anonymity, the Times' Sunday edition said that CEO Mark Pincus solicited employee feedback last month, with the result being a spate of grievances against the company. These complaints ranged form long work hours to stressful deadlines to overbearing managers.

Over the summer, Angry Birds developer Rovio reportedly walked away from acquisition discussions valued at $2.25 billion in cash and stock, citing concerns over the company's culture. Those conditions were reportedly also a primary factor in PopCap turning down Zynga's $950 million cash bid. (EA successfully picked up PopCap for $750 million in cash and stock, with an additional $550 million in bonuses also on the table.)

The former Zynga employees also said that the company especially needs to fear brain drain as it approaches its oft-delayed initial public offering to be traded on Wall Street. Sources say Zynga's IPO, which analysts expect to come in at $15 billion to $20 billion, has been seized upon by recruitment agencies who hope to lure away top talent following the sale.

"I expect a lot of game and tech companies will begin recruiting Zynga's talent after their equity becomes liquid," EA human resources head Gabrielle Toledano told the Times. "Competitors will make the case that they offer much more compelling opportunities for creative people."

Further compounding the brain-drain dilemma, the Times reported earlier this month that a handful of senior employees were given the option to return a portion of unvested stock or be fired. The move reportedly came as the result of Zynga's IPO, with the company feeling that they had doled out too much stock during its startup window.

Tom Magrino
By Tom Magrino

Tom Magrino has covered the games industry since 2006. He's been compared to Steve Martin by Ozzy Osbourne and Daniel Craig by Tim Schafer. His voice, heard largely on GameSpot's podcast, recalls that of Kermit the Frog. It ain't easy bein' Magreen.

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SDSkarface 29 pts

Games made by Rovio and Zynga arent real games.

RgvXavi 5 pts

Proof that at some point everyone sells out. The more important thing is that they sell out in manner that aids development and doesn't hinder the creative mind.

MrHatnClogs 25 pts

If he doesn't want it I'll take it!

SaintWalrus 11 pts

Aww man.. You mean I won't be able to wait 4 hours/beg my friends/ spend money to fill up my energy bar so I can shoot my third bird?

Chainer323 5 pts

can you imagine a zynga style angry birds? where you'll need to ask friends to help you out every day, get quests every couple weeks that those of us that are casual players can never finish, or ads that constantly pop up saying to spend money if you want to get better then average items?

Vodoo 92 pts

If Rovio gets bought up by a big publisher, they'll drain them and have a new Angry Birds game every 2 months for $10. Stay independent Rovio... money isn't everything.

Vodoo 92 pts

Pop-Cap passed up Zynga because of harsh working conditions but went to EA, the KING of over-worked employees? They don't know what they got themselves into lol.

zyugiohz 5 pts

New game coming soon: Angry Zynga :D

vega13mv 5 pts

They dont need Angry Birds, they already have plenty of Angry Employees

VilandasUK 12 pts

Never liked Zynga registered than I was 12 to play something and they are still sending me their emails, so &^%$ing annoying. Nothing personal Zynga but you do suck.

kweeni 5 pts

Wow turning down $2,25B because of bad working environments. My respect for Rovio just rose.

gix47 53 pts

talent at Zynga? all the games are the samething..its a machine

KeleenRem 5 pts

I don't really get why angry birds is so popular. Someone mind explaining?

Spacerac 21 pts

Yeah, love or hate Angry Birds you gotta respect Rovio for having integrity.

EPaul 5 pts

All you guys hate Zygna i get that but you are not seeing the bigger picture. When the Angry birds bubble pops(it will eventually)what will Rovi fall back on? I would take that 2.25B and run cause it might never get any better than this. Well that my thought anyway

Masoodahmedkk 5 pts

[This message was deleted at the request of the original poster]

Masoodahmedkk 5 pts

Is Zynga really worth for $2.25 billion bajjilion dollars? I don't think so.

J_Dangerously 11 pts

Anytime a company loses out because of how crappy it treats it's workers is a good thing.

MJ12-Conspiracy 38 pts

I could care less about casual games or the whole Angry Birds thing but Zynga losing out on a possible business opportunity is good news. To me there is only one type of casual game that I like: the old classics [Tetris, Arkanoid]

Death_Blade_182 15 pts

I don't care about angry birds, but if Zynga loses, I'm happy about it.

Gelugon_baat 384 pts

Scandalous! For Zynga, that is. :P

firehawk998 55 pts

Dear God if the buyout did happen then is a 100 percent chance that the game Angryville would have been released.

FuryX-4 22 pts

Rovio disagrees with the deal and Zynga is super ANGRY about it!

gamerboy100 14 pts

@mjc0961 It's not just EA who purchases studios and shuts them down. I believe Activision is worse when it comes to that.

ziproy 44 pts

I gotta say that's the best reason ever to turn down a buyout offer

JackZor23 5 pts

And I was sooo looking forward to Angry BirdsVille...

KamuiFei 30 pts

With all the merchandise with the Angry Birds label on it, I'd say Rovio doesn't need Zynga.

mjc0961 74 pts

@Daian: The only reason EA doesn't own many studios anymore is because they were always buying studios and then shutting them down. Why did EA shut these studios down? Because their games didn't do as well as had been hoped. Why didn't their games do that well? Because EA lays off half the studio's staff upon acquisition. EA buys up studios and then sets them up for failure and closure.

mjc0961 74 pts

Well, it could have been worse. It could have been EA trying to buy them out. "Those conditions were reportedly also a primary factor in PopCap turning down Zynga's $950 million cash bid. (EA successfully picked up PopCap for $750 in cash and stock" WUT PopCap, you must be out of your damn minds.

XboxGuy1537 23 pts

Die Zynga die! I don't want to play any of your FarmVile crap!

crazyleftykid 5 pts

im glad Rovio turned down Zynga's offer. I respect that the CEO/board of directors at Rovio have the morals to not let their employees have to join a company with poor working conditions. More corporate leaders should act in such a manner.

SickWickinson 16 pts

Sounds like Rovio has enough common sense to not board a sinking ship. Zynga is in a dangerous place right now, with their questionable work environment they stand to lose a lot of money VERY fast if they aren't careful to retain the employees that made them so successful in the first place.

Daian 50 pts

@OJdaLIONKing I think u're confusing EA with Activision, if anything EA has business partnerships with studios instead of actually owning them in many cases.

CptRexKramer 79 pts

Good for Rovio. I'm not sure if I could walk away from all that money, but it's nice to see a company with some dignity for a change. I don't play that casual online game crap, but the missus does. I've seen her get frustrated with Zynga backed games. Too glitchy and never working properly. But Popcap, she loves their games. Never has a problem with them.

jasonzilla11 15 pts

That's a lot of money. You'd expect most developers to take the deal.

OJ_the_LION 5 pts

Zynga seems to be the EA of the casual game sphere, and I mean that in the most negative way possible. Good on Rovio for staying independent for the sake of their employees even though they could have had a big payday. I don't mind casual games, except when they threaten to take investment resources away from real games, which seems to be the case as more regular game companies try to get in on the fad. Unfortunately, I don't think this will be a good long term idea for anybody.

atopp399 5 pts

CerberusEclipse On Android games/apps are tied to your google account or Amazon account if you use them. You do not have to rebuy your games if you get a new phone.

Zer093 5 pts

It's understandable he turned down a $2.25 million offer. Oh, is that a "b"? He turned down a $2.25 billion offer?!? I may hate both companies, Zynga for annoying, exploitive, uncreative rip-offs and Rovio for having an inflated sense of entitlement due to getting one game right, but that's 2.25 billion dollars! There's no way both of their gravy trains are going to last much longer once the fad wears down.

decoy1978 5 pts

Zynga is great for people who don't want to focus playing games. Its something to do as you stare at a screen. I recently just blocked all my Zynga games because it was starting to turn to a 2nd/3rd job of logging on and doing "nothing". Honestly, those games are addicting for just simply clicking on the screen... I got no beef with Zynga. But this is the first time I heard of sketchy working conditions. I know in the gaming industry, you have to scarifice some sanity to push through a deadline, but not at the cost of health or sanity =P

Rottenwood 11 pts

@Richardthe3rd All I really have are anecdotes (which don't equal data), but of the people I know who play Zynga games, they just do it to kill time at work. The idea of putting actual money into them is an utterly foreign concept. Add in all the horror stories of their employees, and the whole thing sounds like a money pit. I mean, congratulations to anyone who can use buzzwords like 'mindshare' to squeeze huge checks out of investors, but I'll pass. PopCap I can appreciate - they give out demos willy-nilly and then charge devoted fans a modest fee for the full versions. That's a sane business model with tangible income.

DrKill09 38 pts

Angry Birds is a glorified flash game. Never understood the hype. :roll:

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