CEO Update(blog.zynga.com)
blog.zynga.com
CEO Update
http://blog.zynga.com/2013/06/03/ceo-update-4/
59 コメント
>It's a shame VC's are so quick to invest in the latest fad because of some temporary "traction" for online games lacking any sort f substance and basically being rips of Maxis titles from yesteryear.
You understand that the entire reason VCs exist is to make money, not do 'substantial things', right? That's not to say the two are mutually exclusive concepts. Just as you can have substantive products that make money, you can also have inane products that make money. The common denominator is money -- this is business. If the latest iteration of Instagram For Squirrels brings in $$$, businesspeople will take a cut.
You understand that the entire reason VCs exist is to make money, not do 'substantial things', right? That's not to say the two are mutually exclusive concepts. Just as you can have substantive products that make money, you can also have inane products that make money. The common denominator is money -- this is business. If the latest iteration of Instagram For Squirrels brings in $$$, businesspeople will take a cut.
I sent him an e-mail asking if he would reconsider a fairly absurd trademark infringement claim against our startup (http://techcrunch.com/2013/05/17/with-friends-joke-goes-here...). He forwarded my e-mail to their corporate counsel, completely throwing out any desire to work with us and leave the lawyers out of it. Pincus has forever gone down in my book as a scumbag. He's the farthest thing from startup friendly that I can think of; I heard he was going to start a startup incubator a year or two ago. I think you'd have to be desperate or crazy to want to work with a guy like that.
To a certain extent I wish that the Paypal mafia had been more successful since I think if they had been able to launch a their own currency it would have shaken up the industry even further, and moved a lot more of it towards productive ventures (i.e. Tesla, SpaceX) than the cruft that fills the industry today. But anyways, they weren't the people for the job. Maybe someone else will do it soon.
>>he cashed out $200M during the share price peak
This shows he clearly knew of what was coming and had to make hit-and-run profit to get money out of it.
I don't know who would ever want to work with such a person again. Besides having $200 million means he may never need to work again.
This shows he clearly knew of what was coming and had to make hit-and-run profit to get money out of it.
I don't know who would ever want to work with such a person again. Besides having $200 million means he may never need to work again.
Even if you fire your early employees, don't they still retain the equity earned up to that point?
Not necessarily. There are a number of ways in which you can lose the rights to your shares, including clawbacks, or clauses in a contract that may stipulate changes to the status of your equity post termination of your employment. A number of equity contracts I have seen also have clauses that state that the board may change the terms of the equity grants at their sole discretion. In other words, until you see an exit with your equity, it's not really your equity.
Most employees of startup companies are given restricted stock with a typical 4-year / 1-year cliff vesting schedule. Aka - they have to be with the the company for 4 years to vest 100% of their shares (25% gets vested on the "cliff")
Also with options, you generally still have to buy the vested portion when you leave, usually within something like 90 days. So you actually have to spend money to keep them, and hope the share price goes up
i believe in this case ex-employees did not get to vest their stock
Note the contrast between this and the departure of Groupon's CEO:
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/03/01/g...
Now of course they are about two different types of events, but this letter is missing a number of things:
- Down to Earth language: "brothers and sisters" (that we just fired) is over-the-top enough to set off alarm bells in the first few sentences.
- No self-reflection or accountability for mistakes. Instead, downsizing is blamed on "scale" not meeting the needs for "leading on mobile." Nothing to do with bad decisions or missteps made by leadership. So what "scale" is needed then? Is Zynga going to fire people until they are a dozen people in a garage so they can "lead" again?
- No re-assurance that future downsizing is not imminent. No discussion about specifics of how the evaluation of employees was conducted. No explanation as to how or why an 18% cut is the right size to provide the expected benefits to the company. If no other information has been provided to employees, people at Zynga should all be in fear of losing their jobs based upon this letter.
- Instead of explaining in detail why the downsizing is beneficial, the CEO punts and says "But I think we all know this is necessary to move forward." This is not a detailed explanation of the upside to the downsizing, it is a jedi mind trick to cause people to project their own justification for why downsizing was the right move. The only justification given for reducing the size of the company is tautological: we need to reduce company size because we need to scale down the size of the company.
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/03/01/g...
Now of course they are about two different types of events, but this letter is missing a number of things:
- Down to Earth language: "brothers and sisters" (that we just fired) is over-the-top enough to set off alarm bells in the first few sentences.
- No self-reflection or accountability for mistakes. Instead, downsizing is blamed on "scale" not meeting the needs for "leading on mobile." Nothing to do with bad decisions or missteps made by leadership. So what "scale" is needed then? Is Zynga going to fire people until they are a dozen people in a garage so they can "lead" again?
- No re-assurance that future downsizing is not imminent. No discussion about specifics of how the evaluation of employees was conducted. No explanation as to how or why an 18% cut is the right size to provide the expected benefits to the company. If no other information has been provided to employees, people at Zynga should all be in fear of losing their jobs based upon this letter.
- Instead of explaining in detail why the downsizing is beneficial, the CEO punts and says "But I think we all know this is necessary to move forward." This is not a detailed explanation of the upside to the downsizing, it is a jedi mind trick to cause people to project their own justification for why downsizing was the right move. The only justification given for reducing the size of the company is tautological: we need to reduce company size because we need to scale down the size of the company.
>- Down to Earth language: "brothers and sisters" (that we just fired) is over-the-top enough to set off alarm bells in the first few sentences.
- No self-reflection or accountability for mistakes.
I was talking with a friend recently about Andrew Mason, and we agreed that he is probably a very decent person deep down, though he made his fair share of mistakes and shady decisions along the way. (In terms of shadyness though, he was for outclassed by his very sleazy cofounder, from what I can tell)
Pincus on the other hand, I have zero doubt he is a slimeball and hence the difference in their communication.
- No self-reflection or accountability for mistakes.
I was talking with a friend recently about Andrew Mason, and we agreed that he is probably a very decent person deep down, though he made his fair share of mistakes and shady decisions along the way. (In terms of shadyness though, he was for outclassed by his very sleazy cofounder, from what I can tell)
Pincus on the other hand, I have zero doubt he is a slimeball and hence the difference in their communication.
More like a padawan mind trick...pretty transparent, if you ask me. You're right, "brothers and sisters" had me rolling my eyes as soon as I read it. Not to mention all those articles saying he sold his shares of Zynga right before the layoffs..
I just realized that generic titles like "An update from our CEO" always indicate bad news. When there's good news they put it straight in the title.
I've gotten a meeting invite at 9am for a org-wide all-hands at 10am that day. Always a bad sign.
Since I hadn't left for the office yet, I was able to quickly change into my black "WTF?" shirt from Thinkgeek, and still make it in time to find out that our VP and four layers of management below him had been nuked from orbit.
Since I hadn't left for the office yet, I was able to quickly change into my black "WTF?" shirt from Thinkgeek, and still make it in time to find out that our VP and four layers of management below him had been nuked from orbit.
> I've gotten a meeting invite at 9am for a org-wide all-hands at 10am that day. Always a bad sign.
Oh boy, I went through a couple of those during the dot-com bust.
Best thing to do is dial into the conference number, even if you are in the office, preferably from a bar down the street.
Oh boy, I went through a couple of those during the dot-com bust.
Best thing to do is dial into the conference number, even if you are in the office, preferably from a bar down the street.
Great observation :) +1
Top ten signs your CEO has been secretly replaced by a droid:
Number seven: outputs jargon-filled error messages such as "These moves, while hard to face today, represent a proactive commitment to our mission of connecting the world through games."
Number seven: outputs jargon-filled error messages such as "These moves, while hard to face today, represent a proactive commitment to our mission of connecting the world through games."
Are you sure droids aren't modeled after CEOs?
Unfortunately, there's no great way to say "we're firing 18% of all employees." If you're whimsical or casual, you'll be blasted for not taking these people's lives seriously. If you're gloomy in solidarity with their misfortune, your stock takes a hit as it looks like your company has lost hope. Most announcements like this are written in business-ese because there's no great "human" response that really works.
Unfortunately, there's no great way to say "we're firing 18% of all employees." If you're whimsical or casual, you'll be blasted for not taking these people's lives seriously. If you're gloomy in solidarity with their misfortune, your stock takes a hit as it looks like your company has lost hope. Most announcements like this are written in business-ese because there's no great "human" response that really works.
Yeah, IMO it's really easy to read between the lines with something like this. It's not like he's trying to disguise his meaning. What is ultimately communicated is:
- I don't enjoy having to do this.
- We need to do this to keep making money at the rate we want to.
Of all the things in corporate America to worry about, the wording of layoff emails is pretty far down the list.
- I don't enjoy having to do this.
- We need to do this to keep making money at the rate we want to.
Of all the things in corporate America to worry about, the wording of layoff emails is pretty far down the list.
A billionaire who basically stole money from their employees and he calls them "brothers and sisters" while laying them off, I do think its something that America should finally start worrying about, yes.
I don't know about this theft you speak of, but surely that issue is tangential to the point about exactly how he worded a layoff email. Theft is bad on its own, no need to conflate it with unrelated matters.
There's no good way to say it, but there are bad ways and this one is more bad than good.
Including "But I think we all know this is necessary to move forward." is certainly a shitty thing to say in a letter like this, EVEN IF IT IS TRUE.
Including "But I think we all know this is necessary to move forward." is certainly a shitty thing to say in a letter like this, EVEN IF IT IS TRUE.
He writes like he's trying to evoke JFK, when in reality he evokes Richard Nixon.
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"We are saying painful goodbyes to about 18% of our Zynga brothers and sisters."
This is where i puked. Seriosly, in whatever company, when you suddenly do not have coworkes, but brothers and sisters - please run, resign, leave. Now!
And if they were really "brothers and sisters", they wouldn't have just been tossed out the door when the going got tough (at least most people wouldn't do that to their actual siblings). So it's puke-worthy whichever way you look at it.
Am I being too cynical, or is this...
...our mission of connecting the world through games...
...just about the most ridiculous bullshit ever? Zynga is about one thing: Profit. That's not necessarily a horribly evil thing (though the ways they go about it might be), but it's most certainly a very clear thing. The only thing they're interested in connecting the world to is their bank accounts.
...our mission of connecting the world through games...
...just about the most ridiculous bullshit ever? Zynga is about one thing: Profit. That's not necessarily a horribly evil thing (though the ways they go about it might be), but it's most certainly a very clear thing. The only thing they're interested in connecting the world to is their bank accounts.
It might not be the most ridiculous bullshit ever if it came from a different company. But Zynga's games are mostly exploitative asocial Skinner boxes that don't do anything to connect anyone in any meaningful way.
I'm not Zynga's biggest fan, but every company has a goal of making a profit. That doesn't mean that company mission/vision statements are irrelevant.
I think the point is that their mission and vision are profit, not connecting the world by games. This would be consistent with most of Zynga's actions.
There's a famous line from the 2008 Batman film "The Dark Knight" in which Bruce Wayne's butler Alfred Pennyworth is trying to explain to Bruce and help him understand the Joker, his new sadistic and unpredictable archenemy:
"Some men aren't looking for anything logical, like money. They can't be bought, bullied, reasoned or negotiated with. Some men just want to watch the world burn." [1]
Maybe this makes me a bad person on par with the Joker, but I don't want Mark Pincus to be bought out, bullied, reasoned, or negotiated with. I just want to watch him burn.
(metaphorically speaking, of course)
[1] http://www.youtube.com/watch?v=efHCdKb5UWc
"Some men aren't looking for anything logical, like money. They can't be bought, bullied, reasoned or negotiated with. Some men just want to watch the world burn." [1]
Maybe this makes me a bad person on par with the Joker, but I don't want Mark Pincus to be bought out, bullied, reasoned, or negotiated with. I just want to watch him burn.
(metaphorically speaking, of course)
[1] http://www.youtube.com/watch?v=efHCdKb5UWc
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At the risk of being flamed into oblivion, I support Mark Pincus' letter.
I don't think there's an easy way to write a letter like this. It's gruesome but necessary for the press - saying nothing is bad press, saying too much opens you up for attack. Similar to how receiving feedback explaining why you didn't pass an interview opens up liability for the company, being too candid and casual with a letter like this is a liability.
This is a shitty part of the business. I'm aware Pincus has made some questionable decisions in the past, and a vocal majority of Hacker News users openly despise him. I'm not going to speak to that - it's irrelevant to this specific letter. But in this particular instance, I think we should reserve judgement.
When Andrew Mason stepped down from Groupon, he didn't have much to lose by making a fully transparent letter of resignation. He was widely praised - and rightly so - but Pincus still has to work at and spearhead Zynga. He can't be entirely self-deprecating and down to earth and "mortal" - he is still CEO, and must be a larger than life public figure who is a businessman first, and observer second.
That said, I don't think this letter is perfect. It's not, and that's not my point. My point is writing a letter like this is hard - these are always formulaic for a reason.
I do not condone his laying off 18% of his workforce, but neither do I condemn it. I don't have the business savvy or inside information to know what would be a best practice for Zynga in this case, but I feel sympathetic to the workers. It sucks to get the news you'll be jobless soon.
I guess the takeaway I'm trying to deliver here is - he might have done shitty things in the past (and I'm not absolving him of those things), but I can't see a way this letter deserves to be torn to pieces as though most CEOs could have done a better job. It's a hard letter to write, and I can't imagine he was thrilled to do it. He struggled to convey a message of disappointment and sympathy while maintaining (apparent) solidarity and corporate strength for investors and publicity. It's a very hard line to walk.
I don't think there's an easy way to write a letter like this. It's gruesome but necessary for the press - saying nothing is bad press, saying too much opens you up for attack. Similar to how receiving feedback explaining why you didn't pass an interview opens up liability for the company, being too candid and casual with a letter like this is a liability.
This is a shitty part of the business. I'm aware Pincus has made some questionable decisions in the past, and a vocal majority of Hacker News users openly despise him. I'm not going to speak to that - it's irrelevant to this specific letter. But in this particular instance, I think we should reserve judgement.
When Andrew Mason stepped down from Groupon, he didn't have much to lose by making a fully transparent letter of resignation. He was widely praised - and rightly so - but Pincus still has to work at and spearhead Zynga. He can't be entirely self-deprecating and down to earth and "mortal" - he is still CEO, and must be a larger than life public figure who is a businessman first, and observer second.
That said, I don't think this letter is perfect. It's not, and that's not my point. My point is writing a letter like this is hard - these are always formulaic for a reason.
I do not condone his laying off 18% of his workforce, but neither do I condemn it. I don't have the business savvy or inside information to know what would be a best practice for Zynga in this case, but I feel sympathetic to the workers. It sucks to get the news you'll be jobless soon.
I guess the takeaway I'm trying to deliver here is - he might have done shitty things in the past (and I'm not absolving him of those things), but I can't see a way this letter deserves to be torn to pieces as though most CEOs could have done a better job. It's a hard letter to write, and I can't imagine he was thrilled to do it. He struggled to convey a message of disappointment and sympathy while maintaining (apparent) solidarity and corporate strength for investors and publicity. It's a very hard line to walk.
We are saying painful goodbyes to about 18% of our Zynga brothers and sisters.
Not to express an opinion about what Zynga is actually doing, but just from the perspective of usage: if you can be saying a "painful goodbye" to someone, where that "goodbye" takes the form of severance, they are not your brother or your sister. Unless you're fratricidal!
Not to express an opinion about what Zynga is actually doing, but just from the perspective of usage: if you can be saying a "painful goodbye" to someone, where that "goodbye" takes the form of severance, they are not your brother or your sister. Unless you're fratricidal!
One question, Zynga - Why are you constantly hiring? Even now, even for the positions you're laying off...
Recruiter here. They still contact me all the time to ask me to work there. Good god I can't even imagine.
Keeps their HR busy.
When the company has to cut 18% of the workforce, the CEO and management has failed the company, basically.
I'm not sure why they are blaming mobile now, when anyone in the tech space could see in 2007 with the iPhone that mobile was going to be a big deal.
Also, mobile has ALWAYS been huge to gaming since the game boy or one could argue, the invention of a deck of cards.
I'm not sure why they are blaming mobile now, when anyone in the tech space could see in 2007 with the iPhone that mobile was going to be a big deal.
Also, mobile has ALWAYS been huge to gaming since the game boy or one could argue, the invention of a deck of cards.
Since dice.
"Our FarmVille franchise teams continue to innovate and deliver ground breaking new social experiences like County Fair"
I'm not sure he knows what innovation means
I'm not sure he knows what innovation means
Exactly what I was thinking.
Well the stock went from $3.40 pre halt to a low of $2.87 just after the reopen and seems to have settled around $3.10.
That's not a great day but it could have been much worse. We'll see what happens going into the close but there seems to be a buy side imbalance currently.
That's not a great day but it could have been much worse. We'll see what happens going into the close but there seems to be a buy side imbalance currently.
"...it could have been much worse."
Yeah, you could have been laid off like 520 Zynga employees just were.
Yeah, you could have been laid off like 520 Zynga employees just were.
Perversely, Wall Street sometimes reacts positively to layoffs since it's an indication that management has stopped deluding itself about the future prospects of the company and is making an attempt to pare down its losses.
In real life, the company is going to try to get the same stuff done with 18% fewer employees by pressuring the surviving employees to work even longer hours, and the employees are going to start looking for jobs elsewhere.
In real life, the company is going to try to get the same stuff done with 18% fewer employees by pressuring the surviving employees to work even longer hours, and the employees are going to start looking for jobs elsewhere.
I think the Wall Street hope is that this means scaling back efforts on unsuccessful enterprises, and "doubling down" on successful areas.
I don't think Zynga needed to be as big as it was anyway, so maybe this could be viewed as getting the business back to the correct size.
I don't think Zynga needed to be as big as it was anyway, so maybe this could be viewed as getting the business back to the correct size.
De-listing is inevitable at this point. I give them 2 quarters before they are a penny stock.
...and those of you who were laid off will no doubt be reading this email on our website as security has shut down your network access and escorted you from the building.
"18% of our Zynga brothers and sisters."
Who refers to family in statistics? This guy is the anti-christ.
Who refers to family in statistics? This guy is the anti-christ.
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Why doesn't he do the right thing and simply resign his position?
He won't be getting much out of his remaining 'brothers and sisters' after stabbing a few hundred of them in the back, a new person would at least have a somewhat clean slate to work from and maybe some hope of turning things around.
When this guy calls you his brother or sister it's time to invest in body armor.
He won't be getting much out of his remaining 'brothers and sisters' after stabbing a few hundred of them in the back, a new person would at least have a somewhat clean slate to work from and maybe some hope of turning things around.
When this guy calls you his brother or sister it's time to invest in body armor.
Hey, maybe Zynga's next mobile game can be B-Scan 360 with Friends? I think there are 500 or so people who would willing sign up to beta test right away...
http://www.nytimes.com/2004/12/12/magazine/12PSYCHO.html?_r=...
http://www.nytimes.com/2004/12/12/magazine/12PSYCHO.html?_r=...
Somebody needs to take responsibility for this. Letting 520 people go is not normal, especially not in the tech industry. It's a disgrace.
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For what its worth, this actually seems like pretty good news if you're a Zynga stockholder.
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That guy is a scumbag.
He scummed (fired) his early employees pre-IPO, he cashed out $200M during the share price peak and left everyone with 6-month options they couldn't exercise, he's referring to hard working employees as "brothers and sisters" in a layoff letter that sounds more like a blog post than a serious document.
This guy should be jailed (and Kleiner reviewed for inflating the stock price of this company), he (and his fad driven company) are an awful example of a tech leader and the tech business in general. He's screwed over countless people, investors and the public market, while sitting back laughing at everyone and everything.
It's a shame VC's are so quick to invest in the latest fad because of some temporary "traction" for online games lacking any sort f substance and basically being rips of Maxis titles from yesteryear.
I've sat in various lunches with VC's where they basically say to each other "hey, we missed out on the Instagram deal, what are the other photo sharing apps in the space we can invest in." It's frightening to see countless idiotic apps get institutional money by basically making derivative products of other crap apps. It's a bad cycle and it needs to end so we don't have more companies like Zynga on the horizon.
But I digress, this guy is a major scumbag!