Drew Angerer/Getty Images
- Zynga founder Mark Pincus announced in a Medium post Wednesday that he is stepping down from his executive chairman role at the gaming company and converting his super voting shares into ordinary shares.
- The decision to scrap the dual class stock structure is an unexpected move, at a time when tech founders from Mark Zuckerberg to Evan Spiegel are holding on to power with super voting stock.
- Pincus said in the post that he will continue to contribute to Zynga efforts, specifically with Facebook Messenger's Instant Games.
Zynga founder Mark Pincus is doing something unexpected in the world of powerful tech entrepreneurs: he's giving up control of the company he founded.
In a Medium post on Wednesday, Pincus announced that he will convert his super voting shares in the company into plain old Class A common stock. That means that Zynga will no longer be a "controlled company" with a dual class stock structure in which Pincus wields 70% of the voting power.
Pincus' stake in the online gaming company will still have the same economic value, but he will now only control about 10% of the vote.
The move represents the first big reversal of the controversial dual class stock structure that has been embraced by tech executives from Facebook's Mark Zuckerberg to Snap's Evan Spiegel.
"It's a good time to evolve my role again"Along with the change in structure, Zynga announced that Pincus will no longer be a full time employee of the company. He will become non-executive Chairman of the company.
"With Zynga in a strong position and a team focused on our players, it’s a good time to evolve my role again," Pincus wrote in the Medium post.
"I will continue to be passionately engaged in Zynga and will continue to partner with Frank on strategy, especially on new platform efforts like Facebook Messenger Instant Games," he noted.
Shares of Zynga were down 2% in after hours trading on Wednesday, following the news of the change and the release of Q1 financial results.
Pincus returned to the position of CEO at Zynga, the company with 300 million players behind social games like Words With Friends and Zynga Poker, in 2015 in the midst of rocky financial times that resulted in the resignation of Zynga's CFO. In 2016, Pincus was replaced by then-chairman Frank Gibeau.
Pincus cites Zynga's steadiness as the reason for his new role: After a rocky few years, cash flow from operations are now in positive territory, and mobile bookings have increased. That said, Zynga's stock has languished in the $3-$5 range for about six years, after listing at $10 a share in a 2011 IPO that valued the company at $7 billion.
Pincus was cagey about what he will do next, besides serving as non-executive chairman for Zynga.
"I love bringing new ideas to consumers, testing, learning and iterating. And I love investing in entrepreneurs and teams doing the same where I can help. Expect to see a lot more of both from me."
Read Pincus' full letter here.NOW WATCH: How does MoviePass make money?
See Also:
- One person has died in an E. coli outbreak in romaine lettuce in 25 states — here's why this food-poisoning expert never orders salad in restaurants
- Another Southwest plane makes emergency landing after window breaks during flight
- Taco Bell's newest menu item paid off big for the chain — here's the secret to its success
SEE ALSO: 10 startups that became worth billions in less than 3 years
