Yammer was an exceptional company, it is now a part of MSFT. So it is gone now.
It is unfortunate that the postmortem analysis that I have seen lacks fair commentary. Instead, Yammer historians offer an inconclusive and magical narrative.
There seems to be two directions of thought. Both treat it as phenomenon of sorts, describing the benefits of travel by teleportation but without explaining its physics.
a. Sloganeering
Yammer succeeded because it understood freemium to Premium. Rhetoricians insist that Yammer was a rational purchase, acquired because it proved itself or was clearly on a path of traction and sustainability and because of that, MSFT had to have them.
It is a philosophy that is incomplete because Yammer history was just way too short to say freemium/premium worked as a mechanism or that they possessed the levers to get them to profitability.
b. MSFT bashers
Eager for proof of MSFT miscues, they discount Yammers strategic and tactical superiority and merely attribute the acquisition to reckless spending and trickle down despair.
As entrepreneurs, investors and spectators who appreciate complexity we would like to learn from Yammers brilliant example.
To delve into the strategy employed on both sides, some abbreviated environmental context:
Yammer had little probability of going public. We did not see glimpses of an S1, its hurdles and dog and pony. We do not know how thay might have used that cash/stock, but certainly it would have required distracting build on accounting, compliance, and dreaded IR. Mutual funds devoted to growth and/or tech would not likely have been persuaded in. The prospectus would have included pages of risks and cautionary statements. Although Facebook had similar peril, Yammer did not have the chatter to drive retail distribution.
If Yammer purchase price was calculated from projections of conversion from freemium, it never would have made it through review and MSFT did not have 1.2 billion dollars worth of distress that they were missing the social arms race. They quickly could have written something/anything social and let it grow quickly within its Office walls.
With those reductions, we can see that MSFT acquired Yammer’s operational excellence and ability to execute and:
Fisher vs. Spassky = Yammer vs. MSFT
Just as in that epic tournament, a great deal of the complexity happened off the board.
Fisher overwhelmed Spassky with outrageous demands, bizarre behavior, lateness, and then…masterful chess superiority.
Yammer was blueprinted to be acquired by MSFT and it was their brilliant architectural plan that initiated construction of Yammer, drove it to act quickly and decisively and compelled MSFT to purchase it at any price.
Yammer didn’t get in the business to operate it. They (correctly) anticipated that getting to profitability or even distinguishing the product would be someone elses burden.
Yammer overwhelmed MSFT with heavy marketing into MSFT base of users, not the CFO/Head of IT but the employee base. They deliberately avoided the CFO/Head of IT and made the deep pockets buy into Yammer later in the adoption cycle if they wanted to have visibility to their employees. Ultimately it reached the very top of the Office chain and they made MSFT pay dearly for the privilege of access.
Yammer was free(mium) but it charged its users in a unique way, users need to invest themselves in setting it up/administering it and creating their own value within their organization.
The product wasn’t ‘free’, it was a currency of a different type and made its adopters stakeholders and evangelists.
MSFT was rolling out Surface, new Windows, New Office and dealing with significant phone/Nokia issues. Its resources were tremendous but spread thin. Yammer built itself to fight the MSFT ‘engagement’ battle.
EPILOG (can also be spelled epilogue)
As MSFT seeks a new CEO, I suggest they look within their own assets. 1.2 billion bought MSFT a lot more than just Yammer plug in.
MSFT legacy and its culture has been built on garrisons to stop uprisings. Perhaps the acquistion also bought them a new strategy.

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