NEW YORK (TheStreet) -- I have a soft spot for socially awkward San Francisco entrepreneurs. I figured at some point that weakness would burn me.
Now, on the rebound, I'm done giving Zynga (ZNGA) CEO Mark Pincus the benefit of the doubt.
Pincus sold the company's stock in a $12 per share secondary offering. Weeks later Zynga reported a pathetic quarter. Longs got fleeced. Pincus charged the shaver.
As employees from every rank jump ship at Zynga, the ones with the privilege of quitting to Pincus' face likely tell him, It's not me, it's you.Investors who dumped the stock do not misunderstand Zynga. And folks who are furious with Pincus have a right to be. Whether he broke the law or not is irrelevant, however one thing's certain. On just about every level, Pincus goes down as 2012's most incompetent CEO. Contrast the unacceptable scene at Zynga with the situation at Pandora (P). Earlier this year, I visited Pandora's Oakland headquarters. I was in the minority on Pandora; therefore, I had to go the extra mile vis-a-vis due diligence. I refused to rely solely on my instinct and standard research. I came away from my chat with Pandora co-founder Tim Westergren more confident than ever in my long position. Ever since Facebook's (FB) IPO blowup, pressure on social media stocks has intensified. Looking back, it's clear Zynga deserved the stereotype of social media loser. Not Pandora; it suffered guilt by association. Before it became obvious, nobody gave Pandora credit for how well positioned it is in the broad new media and mobile spaces. When I met with Westergren, he credited Steve Jobs's invention of Apple's (AAPL) iPhone with Pandora's raging success. Westergren and his team at Pandora saw the shift to mobile coming before the media and bearish Wall Street analysts a) started writing about it and b) incompetently misunderstood it. Not only did Pandora understand the dynamics of mobile migration, it prepared for them. And, as Chairman and CEO Joe Kennedy explained on Wednesday's impressive earnings call, the interactive nature of Pandora as a visual and auditory platform provides display advertisers with more mobile real estate and audio spots with an already tuned-in audience. And, of course, Pandora can mix approaches across ad types and user platforms. If you connected the dots on Pandora, faith has been rewarded. Mobile revenue came in at $59.2 million for the second quarter of 2013, up 86% year-over-year. Pandora now derives more revenue from mobile than it does the desktop. Pandora can target anybody with a budget, but its ability to focus on the $14 billion traditional radio ad market gives it edges practically everybody chose to ignore. First, all Pandora sales executives across the country have to do is turn on the radio for the good leads.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV