Co-founded by Jayant Kadambi and Ayyappan Sankaran in 2004, Yume Networks closed its second round of funding of $9 million. The current round, the company’s second, includes follow-on investments by Khosla Ventures, Accel Partners and BV Capital, as well as new participation from DAG Ventures.

Headquartered in Redwood City, the company is a broadband video advertising network provider to identify, classify, and track content across all digital media platforms—Web, downloads, mobile, and IPTV.

With video ad sales expected to grow from an estimated $775 million this year to $3.1 billion in 2010, according to eMarketer’s July 2007 report, YuMe is aiming at providing flexibility in format, and campaign management efficiency that advertisers have been demanding.

The company organizes online video content into brand-safe, ad-ready “channels” for efficient and targeted advertisement placements, as well as allowing advertisers to buy specific cross-channel “audiences” to ensure that ads appear only in the most relevant contexts. The solution’s crossplatform design ensures that online ads remain intact even if the video content is downloaded and played on a different device.

“As marketers spend unprecedented and ever-increasing amounts on online video advertising, they rightly expect to be able to leverage the full potential of the Internet for ad targeting, flexibility, and customization, rather than settling for run-of-site buys and one-size-fits-all formats,” said Jayant Kadambi, CEO of YuMe.