The battle of the social networks is heating up. News Corp.’s (NWS) MySpace and privately held Facebook may be the most recognized leaders in this market but hi5, a site that’s particularly popular around the world, with more than 60 million registered users globally, got a big boost from a prominent venture capital firm Tuesday.

hi5 announced that MDV-Mohr Davidow Ventures led a $20 million round of financing for the company. hi5’s CEO Ramu Yalamanchi told me in an interview Tuesday that his company plans to use this money to further expand its global presence as well as on product development.

Although the hi5 name may not resonate with as many people in the United States as do MySpace and Facebook, Yalamanchi said hi5 is one of the most popular Spanish-language social network sites in the world, including with Spanish-speaking people in the United States. And Yalamanchi said hi5 will continue to focus on this lucrative market.

“hi5 is fairly strong with ethnic communities in the U.S., Hispanics in particular. For us, this is a market that can continue to grow,” he said.

Previously, hi5 received just a quarter of a million dollars in financing from friends and family in 2003 when the company was founded. But Yalamanchi said that was enough to make hi5 profitable for the past few years. He declined to say how much revenue the site is generating though.

I wrote about hi5 and other social networking companies — including Bebo, Xanga and Tagged — that are aiming to gain ground against MySpace and Facebook back in March. But since then, a lot has changed in social networking.

Facebook opened up its site to developers of widgets, companies like Slide and RockYou, and that has led to a huge boost in Facebook’s traffic. According to figures from Web tracking firm Quantcast, Facebook is now the 19th most popular site in the United States and average daily traffic has shot up substantially since the site unveiled its new open widget platform in May.

The buzz about Facebook is deafening. At Fortune’s iMeme conference in San Francisco earlier this month, I wrote about how some people were speculating that Facebook could be worth a staggering $10 billion and that it still might make sense for someone like Google (GOOG), Yahoo (YHOO) or Microsoft (MSFT) to buy it.

But Yalamanchi said hi5 also has opened up its site to outside developers. So Facebook isn’t the only game in town in the social networking world, especially since he believes hi5 is more of a global phenomenon than either MySpace or Facebook.

“We’ve taken an open approach for a fair amount of time and we will continue to do that. Widget companies have distributed on hi5 and we will allow widgets to be more tightly integrated within the service in the future,” Yalamanchi said.

“We’re different from other top sites because we are international. That’s a key part of the service and we plan to expand into more languages and more markets.”

hi5 has done an admirable job of making a name for itself already. So imagine what the company can do now that it has $20 million of new money coming in. This company is definitely worth keeping an eye on.