Yammer Inc was co-founded in 2008 by former PayPal executive David Sacks and Adam Pisoni in San Francisco. The aim was to create a secure social network that concentrates entirely on business, allowing colleagues to communicate, collaborate on projects and share documents across a secure platform.
The Business Challenge
The Company’s leadership had ambitious plans for growth and quickly reached the point where an overseas base was necessary. In 2010, the Company decided to expand internationally and identified London as the appropriate destination for their European base. In readiness for this exciting new stage in the business lifecycle, the Company needed an experienced Controller to run the rapidly growing accounting function at HQ and sought out Jason Rodrigues, a CPA with a distinguished history of acting for fast growing Silicon Valley companies.
As he implemented a range of new procedures and a global accounting system, Jason knew that the UK setup was crucial to the business objectives and was acutely aware of how fast things were moving. All targets and forecasts were being surpassed well ahead of time and any advisor looking to work with Yammer would have to cope with the challenge of such a uniquely dynamic organisation. Yammer needed more than an advisor - they needed a partner in Europe to help stay ahead of the financial, legal and HR issues that would inevitably and urgently arise over the coming months. Not long after joining Yammer, and at a time when the executive team were talking to various UK advisors, Jason suggested F&L, having worked with us earlier in his career. He commented:
“I have worked with fast paced global software companies in the Bay Area for most of my career and I know how complicated things can get overseas. Yammer needed an advisor that would be able to scale up services as the European operation grew, whilst also having the technical ability to keep us one step ahead of the complicated European rules on topics such as tax and employment law. I had done this before for other companies but it seems as soon as you learn something, they change it!”
F&L started to act in late 2010 and, as predicted by Jason at the outset, it soon became clear that Yammer was destined for an exciting future.
We needed to act fast and provide a wide range of expertise. In a challenging first few months we helped with:
- Company law, company secretarial matters and filings
- Employment law and drafting contracts for the initial senior hires
- Immigration issues
- Transfer pricing
- Recommending and implementing appropriate benefits plans for international staff
- International stock option plans
- VAT registration and compliance, PAYE registration and compliance, identifying a broker for Employer Liability Insurance
- Advice in relation to expansion into mainland European territories
In addition, when Yammer entered Australia shortly after the UK Company went “live”, Jason turned to F&L’s Global Expansion Advisory Network to find an advisor that would be able to help in that country too.
By the end of 2011, Yammer’s UK headcount was growing (and they were still recruiting – fast!) F&L was frequently involved in helping both the US and UK executive teams keep on top of a range of short term and medium term challenges.
During 2012, Yammer’s growth in both the US and internationally moved up a gear. By June 2012 the team were getting used to new offices in the heart of London’s Tech City. F&L had adapted each service line as the business evolved, ensuring that the advice and solutions that were being provided remained relevant. Making use of our own San Francisco office, we were able to deliver a global HR study in relation to existing and anticipated countries in which Yammer was likely to recruit. This enabled the HR department to be as prepared as possible in advance of requests from the global sales teams to hire people in a wide range of countries. The business had also started to make corporate acquisitions internationally and, with the help of our tax department, those deals were completed and assimilated into the UK business efficiently.
As well as advising on the strategic, developing areas for Yammer we continued to help out with the ongoing compliance requirements, including preparation of the annual financial statements and dealing with the corporation tax filings.
On 25 June 2012, Yammer was acquired by Microsoft for $1.2bn, only 4 years after the Company had been founded. Thanks to the limitless energy, dedication and enthusiasm shown by the Yammer team around the world, the investors achieved a liquidity event on preferable terms, significantly ahead of time. The effort put in by Jason and his colleagues in San Francisco and the amazing success achieved by Georg Ell, the General Manager for EMEA, and his team in London made Yammer the big tech success story of 2012:
“I think we did some amazing things at Yammer and I’m proud of my part in that journey, but I know that success depends on many things. The guys at F&L feel less like advisors and more like friends that happen to know a lot of useful stuff! I am grateful to them all for their support and help; Emma Hudson in the global payroll team was a star and coped with everything we threw at her and having Melissa Harkcom available in their US office really gives F&L an extra angle.”
At F&L, we are also proud of the Yammer story and delighted that we were able to act for the business across a range of services in multiple jurisdictions, from the first day of European trade through to the sale of the Company. We also worked with Yammer’s new owner on the transition of non-US operations and other post-acquisition filings that the Company was required to make.
If you are considering expanding overseas into Europe or further afield, please contact Jamie Richardson or Melissa Harkcom, who have many years’ experience helping companies create a successful presence in the UK and beyond.