The British music identification app, Shazam, recently received a $40 million investment from the world’s second richest man, Carlos Slim. Not known for seeding startups, Slim first made his fortune in the Mexican mobile phone industry, so funding a mobile app company is not farfetched. With Slim’s investment, Shazam is positioned to expand its current services in advertising and looks to grow in new international markets.
Shazam originally began in 2002 as a way for users to identify the name of a song, but its most successful business is in connecting TV viewers with additional advertising information. The identification app reached $32.5 million in revenues last year, according to Financial Times. And Shazam is planning to offer an IPO while looking to achieve $1 billion by early 2014, the article reports.
Shazam is moving quickly to work with advertisers and stands to make significant returns. Slim’s investment will quicken its growth in the TV advertising industry.
The rise of second screen media consumption, where viewers watch content on one device while using another, is a major opportunity for Shazam. The company is partnering with Nielsen in order to track the number of people who see an advertisement and interact with it on Shazam. The app company refers to this as the “Shazam Engagement Rate.”
Since Shazam is planning to expand into the Latin American smartphone market, Slim’s investment is a natural fit. He is a major holder in America Movil, Latin America’s largest mobile company.
Carlos Slim Has Bet $40 Million on Shazam, The Atlantic Wire, 7/8/13