Draw Something Draws a Bundle in Sale to Zynga

March, 2012 by

It took six years for the game developer Omgpop to become an overnight sensation — and only six weeks to cash in to the tune of $200 million. With its simple yet endearing Draw Something mobile app generating massive traffic, Omgpop surveyed its potential suitors and sold itself Wednesday to the biggest social media player, Zynga.

David Paul Morris/Bloomberg News
Zynga recently bought Draw Something, a popular mobile app, from the game developer Omgpop for $200 million.
The deal illustrates not only how quickly a company can rise in a viral economy but how difficult it is to stay on top. In recent days, Draw Something was outdistancing Zynga’s hottest game, Words With Friends. Zynga’s options were to spend some time and effort seeking to come up with a superior or at least comparable knockoff to Draw Something, or dip into the cash hoard supplied by its December public offering and make an offer for the whole operation.

David Ko, Zynga’s chief mobile officer, said in an interview that one way Draw Something came onto his radar was that people at Zynga were playing it. But then, who has not been? The game first took off in Scandinavia, for some reason, but is now the top word game in 84 countries as ranked by Apple’s App Store. In the last week, one billion drawings were created.

If Words With Friends is like Scrabble, Draw Something is related to Pictionary. Players draw something, using words supplied by Omgpop, and their friends guess what it is. It is a pop culture testing lab that is highly personal — your drawing depends entirely on your own ability — yet imminently social. What really makes Draw Something appealing, players say, is the ability to display your winning work on a site like Instagram. That is not an option with pure word games like Words With Friends.

Omgpop says the best-guessed words in the game are rainbow, catfish, sun, fish, house, god, tornado. The least-guessed include oar, Warhol, pounce, Polaroid, meathead.

“I play with one of my kids,” said Dan Porter, Omgpop’s chief executive. “It’s such a window into the way they look at the world. Any word can be drawn in any way. Someone said, ‘When I play with my wife, I know in one line exactly what she’s going to draw.’ I saw a tweet from someone else who said, ‘The word in Draw Something was soul mate, and so I drew a picture of you.’ This is just bigger than a game where you’re moving pieces around a board.”

The unconfirmed but widely reported purchase price of about $200 million is four times what Zynga paid in late 2010 for the shop that produced Words With Friends, which gives some indication of how the price is rising for a hit game. But there was immediate chatter that Omgpop had sold itself too cheaply. Business Insider quoted Simon Khalaf, the chief executive of the mobile analytics firm Flurry, as saying: “Omgpop sold way too early. They’re leaving $800 million on the table.”

A billion bucks for one game sounds unreal, kind of like Monopoly money. But Omgpop had other reasons to sell now anyway; it needed to accommodate all these new players, and was having some trouble doing so. Early on, the game overwhelmed an Amazon data center. Also, three-quarters of the staff were working on the game, which meant either hiring a lot more developers quickly or letting games like Puppy World languish. “Zynga is the only company in the world that has nailed scale for this kind of game,” Mr. Porter said.

Source: bits.blogs.nytimes.com