Mark Pincus: The Facebook Desperado Making Off with Millions
Gaming mogul Mark Pincus trashed-talked his way to Wall Street's gutter, trafficked scammy Facebook ads, and is now targeted in a class-action lawsuit. The FarmVille creator's now reaping $450 million in annual revenue and may go public. Revenge is his.
You can see Pincus' swagger as he takes his victory lap in the press, a position arranged by a shiny new crew of PR handlers, believed to be trying to polish his disreputable image for the public markets. The founder and CEO of Zynga compared himself to a genius television producer (in BusinessWeek) and demanded to know why he hasn't been thanked for his contributions to humanity (in Details). He did some drinking with a reporter.
It's almost enough to make you forget Pincus was thrown out on his ass on Wall Street; left embittered and desperate in his earlier days in Silicon Valley; removed scammy commercial "offers" from his games like Mafia Wars and FarmVille amid great criticism, and is to this day fighting off a class-action lawsuit from aggrieved users.
If Pincus wants to put himself in everyone's face as the next internet titan, it's worth getting to know the Silicon Valley desperado outside of his little dog and pony show. So we've distilled a handy guide to the infamous entrepreneur, using our own coverage and recent clippings from BusinessWeek, which profiled Pincus last week, and Details, which for a profile in its May issue photographed Pincus with his bulldog Lola.
Name: Mark Pincus
Title: Founder, CEO, Zynga
Trump cards: The popular Facebook games FarmVille, Mafia Wars.
Winnings: On track for more than $450 million revenue this year and quadrupled company headcount in one year too 775, according to BusinessWeek.
Real jackpot: Pincus is rumored to be grooming Zynga for an IPO, which is probably why he has hired an army of flacks, including MySpace's Dani Dudeck and high-profile Silicon Valley publicist Brooke Hammerling. Update: Dudeck was hired as part of what is rumored to be an attempt to groom Zynga for an IPO, but Hammerling's firm has worked with Pincus since 2007, a spokesman says, so their hiring would not be part of a new PR push — the Dudeck hiring would be.
Pimp pad: Pincus allowed designer Ken Fulk to turn his "very post-90s South of Market loft" in San Francisco's Cole Valley into a "little boutique hotel" type of place, Pincus told C Magazine's Deborah Schoeneman. "It's very Viceroy." That'strue; the porn-shoot photograph over the bar and Moroccan-themed den would probably be right at home in the stylish Santa Monica hotel. Pincus also unleashed Fulk on his Aspen ranch. A bigger picture of the Cole Valley place, as thumbnailed at left, is here.
Badly played hand: Relying on scammy commercial offers to his players for a third of Zynga's revenue. Shady advertisers paid Zynga commissions after tricking users into signing up for $10/month text message subscriptions designed as IQ tests and educational CD subscriptions disguised as freebies, among other scams first reported by TechCrunch.
Most villainous moment: Telling a crowd of aspiring entrepreneurs in Berkeley that "I did every horrible thing in the book to just get revenue right away" at Zynga, including connecting his users with spyware. See video above. Pincus now says, via Details, "I didn't mean to be so crass. But I was talking in a bar."
Probably regrets: Calling his three-week Harvard Business School ethics class "bullshit... I guess it was to make sure we all had at least heard the term a few times."
Should regret: Being so cheap. After selling his early social network Tribe.net to Cisco, Pincus took his college buddies out to a raucous dinner at Nobu in Aspen, Colorado. Rather than using some his sweet tech cash to treat his old homies, Pincus let his buddies play credit card roulette. One got stuck with the massive bill.
And after lucking into a date with none other than Cameron Diaz, Pincus let the comely movie star buy his drinks.
Why he should spend more time with his family: Pincus' sister teaches business ethics at DePaul University's business school.
Last score: Pincus sold FreeLoader for $38 million in 1995, seven months after creating the personalized internet news service, which used faddish "Push" technology.
Last stumble: Tribe.net, which fizzled, Pincus told Details, because there was "nothing to do" there once had brought "all these people together... it's like a [bad] cocktail party." But Darren McKeeman, whom Pincus described as his "great" sysadmin, has alleged (here, here and in an email to us) that Pincus misappropriated $30,000 in donation and subscription revenue from Tribe.net users, intended to keep the site running, to start Zynga. Pincus took out a temporary restraining order on McKeeman.
Click to viewBitter much?: In a 2009 speech at a "Startup School" on the UC Berkeley campus, Pincus lectured about how venture capitalists can steal companies from founders like Pincus. See video above. One person who was there said he sounded "bitter about his first company being taken over by venture capitalists. He also seems bitter about what a big pile of money does to personal relationships. That might be the driver behind his need to be profitable early on."
That certainly jibes with TechCrunch's summary:
Pincus says there's no such thing as an independently-controlled company. Your VCs [venture capitalists] get some board seats... Someone else is running your company.... you're not getting the head of the firm... [and] junior VCs are junior for a reason. If you have a conversation with [a senior VC like] John Doerr, he'll say yeah, let's do that. Junior guy is more nervous about the downside...
They say... you've never run a big company any more, so they talk about hiring a COO. Then you find out there is no world class COO who would work for a 20-something-year-old... So then you have to make them CEO. Death by a thousand compromises. Pincus says after an ordeal like this, he was left with a public company that was profitable but he wasn't fulfilled.
...Referring back to his issues with the board, [Pincus said] If you're profitable, you can control your board.
Current mood: Cocky and hyper. From BusinessWeek: "'It's fun,' he says, swiveling back and forth in a conference room chair. 'It's adrenaline.'"
Delusion of grandeur: Compared his rote Facebook game Mafia Wars, designed to extract money from internet simpletons, to a smartly-written, 21-Emmy-award-winning premium cable watershed: "I think it benefits Facebook's users if we can create the next Sopranos and if we can be a brand, like HBO, that their customers really want."
Partner in virtual organized crime: Facebook, the platform on which Mafia Wars and FarmVille runs. Zynga got socked by the social network's March decision to ban games from Zynga and other companies from users' "notification" screens, where the companies had been spamming to recruit new users. Now Facebook is poised to make Zynga use Facebook's own virtual currency rather than PayPal, a move that will give Facebook fully 30 percent of Zynga's user revenue. The move would also mean Facebook could more aggressively restrict Zynga's questionable refund and fundraising practices.
When even bankers think you're an asshole...: By his own admission, Pincus was basically fired from Bain, one of the only people to ever achieve that status at the rarified management consultancy. He apparently also "flamed out" at Lazard Frères; Pincus told Details how he achieved this: "I went out of my way to tell people they were stupid if I thought they were. People loved me or hated me. In hindsight I was forcing myself to be an entrepreneur-I was shutting all the doors."
Position on 'evil' corporations: Supportive:"You read all these stories now about how Google is evil," Pincus told Details. "But I admire Google. I want Zynga to be one of the five or six brands that matter in people's lives."
Position on drinking in front of a reporter: For it: "I'm trying to kill it the old-school way, with alcohol," he told Details' reporter of his cold. "'The same people who called you an idiot will kiss the ring,' Pincus [tells the reporter], downing the last of the sake." (Update: We originally said "boozing in front of a reporter," but not to mean drinking in excess. The writer of the Details piece tells us, "During the course of our 2+ hour dinner, Pincus had one small bottle of sake." Sounds much calmer than Pincus' rowdy session at Nobu, then.)
Position on the media generally: "I feel morally offended that we get attacked by the media for doing something good and no one else is outraged when these people are wrong."
Position on Gawker specifically: Said we "spread lies" about Zynga but wouldn't elaborate.
You're welcome, ingrates: "We invented social gaming," Pincus said in Details in a rant about how mean the press is. "We were the first ones to figure out virtual goods and social pay, and we've helped the whole industry. They haven't thanked us for it."