Zynga’s ‘abnormal’ valuation caused unrealistic F2P expectations, says Infernum founder

By Dave Cook, Wednesday, 19 December 2012 13:24 GMT

Zynga was evaluated rather highly at the start of 2012, painting a picture of free-to-play browser and mobile developers as unstoppable money-making forces. The reality is far from that image, Infernum founder Andreas Weidenhaupt has argued in a new interview. Weidenhaupt has cautioned that such lofty expectations place immeasurable pressure on F2P developers, and has subsequently called for a reality check.

Speaking with Gamesindustry International, Weidenhaupt expressed concern that investors and share-holders in the F2P market are expecting rapid company growth that pushes what is realistically achievable.

Weidenhaupt said, “Since Zynga reached an almost abnormal market valuation investors and shareholders tend to expect much too high growth rates in much too short a time.

“By now, one-digit growth rates are not even regarded as good enough. If you plan double-digit growth rates you run the risk of threatening your whole business model, if the presumed growth rate is simply not happening.

“This affects the company manpower planning as well as product schedules and licensing. The market is dominated by the propensity to copy each other in order to be able to communicate these expected growth rates. We have to grow sustainable, healthy and not at any cost.”

GI.Biz reports that publisher Koch Media announced that it had bought a stake in Infernum yesterday, as it looks gain a foothold in the free-to-play market.

Despite interest from third-party publishers like Koch, Weidenhaupt stated that Infernum will continue to grow at a slow, steady and realistic pace, as to avoid boxing itself into a corner. As such, the company is expected to grow from 32 to 50 staff in the new year.

“I have to ask myself, for whom essentially are numbers of 300 million registered users communicated in the end?” he added. “If you see this from a logical standpoint, you could stop any marketing activities immediately because you have already reached the available audience many times over already.

“An online marketing manager has to be able to market a game on a quality level instead of only buying traffic.”

Infernum’s first launch title Brick Force, currently has over 1.5 million players, yet Weidenhaupt is keen to downplay excitement for fear of setting bars too high.

Is this is a wise move on Weidenhaupt’s part? Should investors ease off in their expectations? Let us know below.

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Andreas Weidenhaupt

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