Anyone holding up their phone to the ringing of the New York Stock Exchange opening bell and hoping to identify Shazam as the artist will have to wait a while longer.
“We’re going through a different maturity cycle to Pandora,” Andrew Fisher, chief executive, told us in an interview.
“The key thing for us is that over the past 12 months, we’ve been focused on the broadcast industry and that’s an inflection point that takes us into a new market.”
Capturing TV advertising dollars would take Shazam beyond competing just for digital budgets and it aims to generate more than half its revenues from TV advertising over the next two years, compared to close to zero now. The new funding round will help Shazam scale to this challenge.
“We’ve gone through all the trial phases with the networks this year, they’ve turned into full series commitments, while with the advertisers, we’ve moved from test campaigns to very large campaigns,” said the CEO.
Shazam for TV is the name of the service, an evolution of its original app that can identify songs and artists by holding a phone up to the sound for a few seconds and allowing Shazam to sample it through the microphone and match the musical fingerprint with its database over the internet. Its 140m users go on to purchase $100m worth of music a year through its platform.
Now that users have smartphones and tablets by their side as they watch television, Shazam for TV encourages them to hold up their devices to the set when its logo is shown. The dialogue or music from a programme or an ad can be matched to bring up offers, coupons, direct links to purchase what is on-screen or more information that can add to a viral campaign.
In one recent example, Lady Gaga showed a Shazam logo in her hand to prompt users to download the first clue in a treasure hunt promoted by Starbucks.
“If we can demonstrate momentum around [Shazam for TV], both with the broadcasters and the advertisers, we think our valuation is going to be significantly enhanced and that would be the right time for us to go to the public markets, not now,” said Mr Fisher.
Kleiner Perkins Caufield & Byers has led the current round after the Silicon Valley VC first invested in Shazam in 2009. This time it has been joined by Twitter and Zynga investor Institutional Venture Partners and existing backer DN Capital.
No valuation is being officially provided for Shazam with this round, but sources said it meant the UK-based company was now worth hundreds of millions of dollars.
Shazam, which also has offices in Palo Alto, recently acquired Silicon Valley startup Tunezee, allowing it to add lyrics synchronised in real time to music.
“Part of the funding will also be used for acquisitions, we are looking at talent and technology in terms of scaling our organisation,” said Mr Fisher.
“We do think the app economy is starting to consolidate now and we certainly see ourselves as a consolidator.”