Yammer, which currently has over 4 million corporate users, will use its additional funding to grow its sales and engineering teams within the United States and internationally. The company is also looking to use the funding for potential acquisitions and promoting its brand.
The $85m investment works out at around £53m.
The service focuses on improving employee productivity and engagement by allowing private communication within organisations or between organisational members. It differs from external social media sites like Facebook and LinkedIn in the sense that the engagement is only internal among businesses.
The company has been growing since its launch in late 2008 to over 4 million users, with 85% of the Fortune 500 using the free service.
Some of Yammer’s top customers include Shell, Deloitte, and Vodacom.
DFJ Growth, a part of the venture capital firm Draper Fisher Jurveston, led the financing round, and participation from new investors included Capricorn Investment Group, Khosla Ventures, Meritech Capital Partners, and the investment division of Jeff Skoll. NFL Hall of Famer, Ronnie Lott, also participated.
"Yammer launched the category of Enterprise Social Networking and pioneered a new model that drove unprecedented adoption in the enterprise," said David Sacks, founder and CEO, Yammer. "This significant influx of capital provides us with the resources to expand quickly and strategically, innovate rapidly and extend our market leadership."
Yammer’s plans to expand and promote its brand have started rolling out as the company opened its London office just last year and launches its first print and online advertising campaign today.
Investors like Randy Glein, managing director of DFJ Growth and observer seat holder on Yammer’s board of directors, are confident that Yammer will see increased growth in the future.
"In the past few years, Yammer has assembled a world-class team and built a pioneering social networking product for enterprises," said Glein. "Yammer’s customers absolutely love the product and its benefits for their organisations, turning them into brand advocates and helping fuel Yammer’s explosive growth. This financing will enable Yammer to extend its market leadership and seize the massive opportunity in front of them."
It is no surprise the company is gaining investor attention as it saw extensive growth in 2011. Yammer saw a 2.4 million rise in users from 2010 along with over 800,000 paid seats, up from 300,000 in 2010.
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