Mark Pincus is no magician, but over the last year Zynga’s notoriously micro-managing founder has pulled off a trick no one thought he was capable of: disappearing.
Today, the company said he would be stepping down from all day-to-day operations — though he would remain chairman of the company. “While I’ll still keep an office at Zynga, and be active in supporting the company, I will not have an operating role. Most importantly, I remain Zynga’s largest shareholder and biggest believer,” he wrote in an internal memo circulated to Zynga employees.
But according to interviews with four sources inside or close to Zynga, Pincus had already been largely absent from Zynga since his stepping back to become “chief product officer” of the company.
While questions swirled as to whether he would be able to let go of the company he founded, Pincus has seemingly broken character and receded into the background to allow Chief Executive Don Mattrick room to put his stamp on the gaming company, according to several sources familiar with his activities. Sources described Pincus as having “checked out” for most of Mattrick’s freshman year at the gaming company — the former Xbox head was hired in July last year, when Zynga was at arguably its lowest point, and Pincus stepped back back into a “chief product officer” position. Indeed, two sources said Pincus even symbolically divorced himself from Zynga by living in a vacation home in Aspen, Colorado for a spell.
Pincus’s newfound altruism has helped the company he founded and brought to prominence regain a toehold — if not its footing. Zynga still faces the macro challenge of restoring the massive player base it lost to more popular games played on mobile devices, but with Pincus on the sidelines, Mattrick has been able to re-orient the company through a series of personnel and strategy changes. Mattrick, for example, coordinated Zynga’s first major acquisition since the failure that was OMGPOP with the $527 million deal to buy NaturalMotion. Mattrick actually used a large chunk of what is observed to be Zynga’s biggest point of leverage — its more than one billion dollar cash pile, giving it plenty of runway to find new games that will return the company to prominence — in the acquisition.
Sources said Mattrick also swiftly axed superfluous projects and narrowed the company’s focus to a few core efforts that include leveraging its existing games, finding new intellectual property, and exploring the potential of its somewhat meandering gaming network, which since launch hasn’t gained a strong amount of traction beyond a small slice of Zynga players due to it being “over-engineered” and not very user-friendly.
Taken together, sources said that internally a sense of optimism has actually returned to Zynga. “There’s been more certainty in the past six months than there has been in the past five years,” one source said. “For once, we have a plan for 2014, and we’re following through with it. It isn’t changing every quarter. We’re already thinking about 2015 and 2016.”
Shareholders, too, seem to be pleased with the company’s new direction.
As Zynga continues its shift to a bona fide gaming company under the more creatively-focused Mattrick, Pincus’s analytical savvy, which helped propel Zynga to an initial public offering that valued the company at $10 billion, has grown less urgent to its operational needs. But while Pincus has been less involved at Zynga, he has managed to keep himself extremely busy.
Sources said that lately Pincus has turned his attention back to investing, where he previously found success by taking early stakes in companies like Facebook, Twitter and Brightmail. According to one source with direct knowledge of his investing activities, Pincus invested in Dropbox, which is expected to be the next high-profile technology IPO following Twitter. Another source familiar with his activities at Zynga said Pincus even explored raising a fund of his own, though it’s not clear if that ever moved beyond the informal phase.
Earlier this year, Pincus — like much of the rest of Silicon Valley — sought to invest in the recently-launched and massively-hyped app, Secret, according to two people familiar with Pincus’ investing activities. But not unlike other potential suitors, Pincus was turned down, though not before he invited the team to his Aspen home to meet his family, according to these people.
Pincus in recent months has made himself just a little more present at Zygna’s headquarters, nicknamed the “dog house” because of the giant red and white dog logo on the side of the building, on San Francisco’s Townsend street, near the Caltrain station. He has been quietly checking in and gathering individuals for special projects and prototyping, according to two people familiar with his activities, according to two people familiar with Pincus’ activities at Zynga, though it’s not clear if they have formalized into actual teams or products.
Whether Pincus will revert to wanting to control the company again is an ever-present question. Zynga’s corporate suite is no stranger to executive turnover, after all. The company has named three chief operating officers and two chief creative officers in the past three years. Zynga alumni ominously point out Pincus’s habit of becoming “obsessed” with an individual — usually for around a year to a year and a half — before moving on to the next person.
Still, it’s hard to deny the enthusiasm that many industry watchers and insiders have for the new, post-Pincus Zynga. And, for the time being at least, it seems he is content to let Mattrick take the wheel — including today’s largely symbolic step back from a position that he never seemed to fully occupy in the first place.