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mark-pincus-zyngaIt looks like early reports about social gaming giant Zynga’s new funding round were a little conservative.

Earlier this week, the Wall Street Journal said that Zynga was raising $250 million at a valuation of $7 – $9 billion. Now both The New York Times and All Things Digital report that the funding round is almost completed, and that it gives Zynga a $10 billion valuation.

The stories differ on the funding amount, with The Times saying that it will be $250 million while All Things Digital says it’s $500 million.

Zynga’s 2010 revenue was estimated to be $850 million, so the company is being valued at more than 10 times that amount. VentureBeat’s Dean Takahashi said the rumored $7 billion valuation was “astounding” but that Zynga has attracted enormous investor interest since it cracked the free-to-play gaming model, where the games are free but players pay for virtual goods. It also helps that Zynga has moved past its first big hit, FarmVille, with its new game CityVille becoming the fastest-growing game ever. Plus, it’s getting serious about international expansion and mobile gaming (in the latter case through the acquisition of Words With Friends-maker Newtoy).

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The other big-name social networking companies are seeing similarly elevated valuations, with Facebook valued at $50 billion after earning about $2 billion in revenue last year, and Twitter valued at $3.7 billion despite only recently getting serious about revenue.

Zynga’s new funding, like Facebook’s, is seen as a likely prelude to an initial public offering. Potential investors reportedly include Morgan Stanley, T. Rowe Price, and Fidelity Investments.

(Zynga founder and chief executive Mark Pincus is pictured above.)

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