Maybe they just priced their IPO shares correctly for a change. When the share price doubles on the first day, it means the offering price was too low. That means Wall Street gets the money, not the company and not the pre-IPO investors.
They could have priced it 40% lower, and seen a big runup. But this way the company gets more working capital. That's good.
Maybe that's a positive consequence of Zynga's CEO's need to hang on to so much control and equity.
It always amuses me how the avowed capitalist tone of HN changes when it comes to a start-up cashing out. I wonder why "Wall Street" getting the money didn't bother pre-IPO investors and VCs in all the previous tech IPOs or stop them from investing on the same terms again and again. After all, it couldn't be that the same "Wall Street" later rewards those playing by its rules.
I'm very skeptical that all participants of this IPO, from the VCs to the CEO and board to the underwriter, weren't on the same page regarding how the system works and how IPOs work in this system.
They could have priced it 40% lower, and seen a big runup. But this way the company gets more working capital. That's good.
Maybe that's a positive consequence of Zynga's CEO's need to hang on to so much control and equity.