Zynga Raised $20.5M Before Acquiring Challenge Games

Date: Jun 07 2010 02:54:43 Source:
KeyWord: Zynga, Challenge Games, Austin-based social game
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The California company that last week acquired Austin-based social game company Challenge Games Inc. may have paid more than $20 million in the deal.

The acquiring company, Zynga Game Network Inc., reported $20.5 million financing related to a merger or acquisition, according to a filing last week with the U.S. Securities and Exhange Commission.

Zynga plans to operate the local office as Zynga Austin, a game studio focused on product development. Challenge Games co-founder and CEO Andrew Busey became Zynga's general manager and vice president of the Austin studio, officials said.

The Challenge Games team of 35 employees will be immediately integrated into Zynga's workforce. Zynga already operates studios in San Francisco, Baltimore, Los Angeles, Bangalore and Beijing.

Challenge Games, launched in 2007, was backed with $14.5 million in funding from Sequoia Capital and Globespan Capital Partners. The company focused on immersive Web game development built on a virtual goods business model.

Two of the company's most popular games, Warstorm, a collectible card game set in a fantasy universe, and Ponzi, a tycoon game, will be further developed by the Zynga team, officials said.

Zynga, which recently completed a $180 million financing, has been on a buying spree. It is reportedly projected to generate $600 million annually in revenue.

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