King, makers of the much ballyhooed Candy Crush Saga, are now trading publicly. As expected by some, their IPO has fallen well short of expectations. An initial stock price of $22.50 immediately slumped to $20.50. At the time of publication, their stock is at $20.13 — and falling.
The game maker garnered a lot of attention for going public, with some believing such a move would strengthen their efforts for years to come. It’s a bold move not only for King, but for ‘freemium’ games in general. King is widely considered the cream of the fremium crop when it comes to game development, with Candy Crush Saga still going strong.
They have competition, though. Competition that took alternate routes to secure backing. Supercell, makers of the very popular Clash of Clans, has financial security from two Asian companies. Others simply rely on their in-app purchases to carry them. Freemium games account for the lion’s share of revenue for mobile, with a 200% increase in 2013 when compared to 2012.
King’s IPO is reminiscent of Facebook’s own introduction into the public sector. Their IPO was among the most notable disappointments last year, falling hard on initial trading. When you look at it now, though, Facebook stock trades well over $60/share. Not only is that well above the initial asking price of around $35, it’s about triple the initial slump people thought they’d never recover from. King’s stock is likely to rebound similarly.