Shazam Raises $32M to Push Into Television
Shazam, the popular mobile music look-up service, has raised $32 million from investors including Kleiner Perkins and Institutional Venture Partners.
The company has more than 140 million users (people who have downloaded one of its apps and tagged at least one song) and is adding 1.2 million more per week. It has millions of paying users for its subscription iPhone apps, as well as significant revenue from advertising and affiliate purchases. The company sells at least 300,000 songs per day. And its fellow mobile music breakthrough star, Pandora, just went public.
But what Shazam is really excited about is television, which it sees as a bigger opportunity than music, executives said. The company has embarked on a flurry of deals with networks like MTV and Syfy and advertisers like Old Navy (see screenshot above).
Select TV programs and ads now encourage viewers to “Shazam” them, using the audio recognition features of Shazam apps in order to receive bonus content and discounts. With 140 million built-in users, early deals have shown impressive results. (You can see examples of what the integrations look like on Shazam’s YouTube channel.)
Shazam joins a growing list of companies trying to get viewers to “check in” on the Web while watching TV. IntoNow, which also uses audio recognition to identify TV programs, sold to Yahoo in April for about $22 million.
There’s real money in making brand advertising interactive and accountable, and potentially more so than the pennies extracted from helping other people sell music, said Shazam Executive Vice President Marketing David Jones.
Jones said TV partners pay Shazam
a flat fee plus engagement cost a CPM based on their TV impressions, and early results show incredibly high rates of participation. Of the hundreds of thousands of users who Shazam-ed the Old Navy campaign, 27 percent of them interacted further by shopping on their phone or downloading an MP3.
Ten-year-old Shazam is based in London and has 120 employees. It recently made its first acquisition, Tunezee, and intends to use some of the new money to buy more companies.
Jones also said to expect improvements to Shazam’s social efforts, which to date consist of a feature called Shazam Friends that shows what music and TV a user’s friends have tagged.
The new funding has been incorporated into Shazam’s Series C round, which was of an undisclosed amount in the fall of 2009.