Here's What Yammer Plans To Do With The Money It Will Raise Soon

Yammer CEO David Sacks

Photo: Yammer

Enterprise social networking company Yammer is talking to multiple VCs about a new funding round, and may raise up to $40 million in coming months to help expand into new countries and bigger companies.TechCrunch first reported the news earlier this afternoon.

In a conversation with Business Insider, CEO David Sacks hinted that new funding would help Yammer grow its enterprise sales force and expand internationally, although Yammer has no funding news to announce now.

VCs are particularly interested in enterprise startups after Jive’s successful IPO last year — just today, Lithium announced a $53 million round.

Selling to bigger companies is particularly important. Right now, Yammer is often first adopted by employees or departments. The company can later try to convert those casual users into paying seats by making a pitch to the IT department.

“We’ve been moving very quickly to expand and professionalize our enterprise sales team,” Sacks said, and recently made “one of the most important hires in the history of the company,” grabbing David Obrand away from to help Yammer reach out to enterprises.

He also said that international expansion is a big opportunity because Yammer’s viral model means it already has a pipeline into countries where it doesn’t yet have sales staff.

Sacks said that Yammer’s revenues have tripled in the last year and paid users have gone from 300,000 to 800,000. He wouldn’t comment on whether the company is cash-flow positive, saying “we’re not trying to optimise for that, we’re in growth mode.”

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