A few media outlets including http://twitter.com/#!/TheNextWeb have claimed this means Zynga has a $1 Billion valuation. That's not true. Zynga is RAISING $1 billion. Some of the stock will not be available on the IPO day.
So... how much of the company are they going to sell? Or haven't they announced this yet either?
A $1 billion valuation would seem awfully low, since last I heard they have multiple hundreds of millions (possibly half a billion) in revenue. I personally have concerns about the long-term sustainability of their business model, but I'd expect a valuation much higher than this.
Personally I won't invest. Too evil for my tastes.
While I don't know specifically how much equity they intend to sell, investment banks typically like to make their IPOs between $12-14/ share. Given their last VC round was funded by Morgan Stanley and T. Rowe Price [1], I would guess they will be shopping the deal among their investors to gauge interest, and then price the shares as they see fit.
