Mark Pincus memo to Zynga employees

I'm glad to hear that anyone at Zynga is meritocratically given a chance to lead, rather than it being based on how early someone got in. Looking forward to hearing more about the process that will be used to determine whether Pincus should stay on and retain his shares, or whether he should be replaced with a different leader.

Pure spin: Pinkus is trying to make this story about merit and reward. But really its about not honoring contracts.<p>The stock options given to employees were part of their employment contract with the firm. They were based on imperfect knowledge of future facts on both parties, i.e. taking risks. Zynga attempted to use its power to revise the contract post-hoc.<p>If I have to negotiate a deal of any sort with Zynga in the future, I'll be wary of them honoring it.

This is an official memo to Zynga employees and Pincus can't even take the time to use proper grammar and capitalization?

That didn't really say anything.<p>Perhaps someone could find another company that has threatened firings unless employees give back options, and Pincus can copy their CEO's memo to employees.

The whole situation can be fairly simply explained: a conflict exists between rapidly-growing companies and their early employees. It's kind of a flaw in the way the system works, and it's not really just for pre-IPO companies.<p>A common situation is an early "non-essential" employee receives something like 0.25% of the company, vested over 4 years. Suppose that at the time the employee is hired, this 0.25% is worth $10,000 or so ($4 million valuation). If the company manages to grow 100x in value, the company is now paying a non-essential employee $250,000/year in stock. With at-will employment, the company can legally fire them.<p>The conflict arises because there is no <i>legal</i> incentive for the company to keep this employee at this point. Fortunately, it's not all that bad for the employees as long as they have <i>some</i> vested stock since this problem only arises if the stock value gets too high.

Successfully taking risks should be rewarded in any meritocracy. Portraying employees who took a risk by working for the company before they were making money hand over fist as undeserving is wrong.

This sounds surreal. It's like the Godfather telling his family how ethical they all are. Cosa nostra ethics of course ... what happened to the good old "every dirty trick in the book" days?

This is the part that scares me: "we want everyone to put zynga first and contribute to the overall success of our company...".<p>I have a life, I want to continue to have a life. That will always be more important than my job.

Mark made the mistake of going half way in trying to accomplish his Machiavellian goal. He should of either left them be or terminated them. Or done it how it's usually done where they dilute and give the new stock to the people they like better.<p><a href="http://www.sebastianmarshall.com/the-failure-to-execute-kobayakawa-hideaki-and-the-fall-of-the-toyotomi" rel="nofollow">http://www.sebastianmarshall.com/the-failure-to-execute-koba...</a>

Huh? This memo doesn't seem to have much substance in it. Is he just brushing it all off basically saying "WSJ is lying, now forget about it all and go back to work" or am I missing something?

In Pincusland, contracts are to be disregarded because of, um, you know, merit.<p>So what about the merit of the people who gave out all those options? What about them?

So he's basically confirming the rumor, by saying they are a meritocracy and early comers don't get preference.. Still doesn't address the fact that if true, they got back shares that they gave out.

So all the sleazy policies are ok now as Zynga has been proclaimed to be a meritocracy by Mark Pincus. Nothing to see here folks, please move on!

Well, I hope Mark Pincus resigns and returns his stock options to concede his lack of merit.

It sounds like Pincus may have inadvertantly done everyone a favour in that he will make people be much clearer from now on as to what stock options really mean and what they are really worth. Sounds like trading present salary for future stock value has just got a lot less compelling a proposition.

Bottom line -- if Zynga feels that an employee is not pulling their weight, they should let the employee go for that reason alone. Stock should never enter into the equation and the fact that it has shows that Pincus' motivations are not as pure as he'd like people to think.

He shouldn't be CEO if he can't write a memo that is free of grammatical errors.

I'm all for a meritocratic culture, but sorry Mark, this has nothing to do with merit. People who believed in you joined your company early and invested in it. Irrespective of their performance, it's not their fault that their bet was right and now that you're on the verge of success, you have to pay up. Deal with it. If you're concerned about their performance, let them go based on that and not an ultimatum to return stock.

Those who have a material proof of the original story are going to get a looooooooooot of shut-up stock options, whether they work in the kitchen or not.

Not sure how this memo addresses the complaint of employees being strong armed into relinquishing their stock options. Seems like a very vague and general message that didn't offer any real insite.

I find that the surest sign that a company is <i>not</i> a meritocracy is when the CEO regularly states this. Kind of like how most Communist countries are known as "The People's Republic."

Ran out of capital letters there towards the end. That's nice work, Lou.

It seems his shift key broke halfway through

on the lighter side <a href="http://didweipoyet.com/" rel="nofollow">http://didweipoyet.com/</a>

Perversely, I enjoyed reading this memo. Mark Pincus is a classic psychopath and it's always educational to observe how people like him attempt to justify themselves.<p>The psychopath's language is usually a caricature (sometimes to the point of absurdity) of going assumptions of the culture in which he's trying to win acceptance. Though they have no values, they are skilled at picking up others' values and using them to make their actions seem acceptable. In Pincus's case, he's taking the noble concept of meritocracy and twisting it into bizarre shapes, refusing to stop even at outright fraud.<p>Oh, and if I understand Mr. Pinkus right, people who work with food don't deserve to make money. Fucker.<p>Judging his attitudes from his writing and actions, he'd be a natural fit for the Tea Party. Since the Tea Party and Zynga are the two malefactors most responsible for insufferable activity on Facebook, this is a natural transition for Mr. Pincus.<p>To the screwed: sorry to hear it, but I guess this is what you get when you work for a company whose name sounds like 4th-grade anatomical slang.

These employees were given options for some combination of performance and risk / opportunity cost from taking an early job in an unproven startup. For Pinkus to renegotiate with only the former in mind while ignoring the latter is bs. These employees need lawyers. But such self-dealing is what you would expect from someone like Mark; I can't understand how anyone believes someone involved in lead-gen scams the way Zynga was retains any ability to claim to be ethical, and particularly to be "proud of the ethical and fair way that we've built this company."

edit: why downvote this? I've just expressed confusion that a cooperative outcome could not be reached.<p>While it's reasonable that Pincus wants to find some way to obtain more shares other than buying them, sending an email like this could not be beneficial to morale.<p>If it is truly in the best interest of Pincus and Zynga to obtain the shares, then it's also in the best interest of the targeted employees to give up the shares in exchange for something else with equal or greater expected value.<p>Since the hubbub around this reflects poorly on the firm as a whole, the employees refusing to cooperate are likely shooting themselves in the foot, though it also seems that Pincus has blundered significantly.<p>Pincus at least seems to be acting rationally about the future of Zynga, while the employees (even if they have reason to be annoyed by this) come off as being motivated purely by greed, spite, and short-term considerations.