Shazam app gets $40 million investment from tycoon Carlos Slim
Smartphone聽app developer聽Shazam聽has found an unlikely ally in the form of聽Carlos聽Slim, one of the world's richest men, who is investing $40 million to back the development of the Shazam app start-up best known for helping music fans identify catchy songs.
The move is surprising for 73-year-old聽Slim, who built his company America Movil in a more staid sector, namely the highly regulated telecommunications and TV business in聽Latin America.
Before聽Shazam,聽Slim's only forays into聽Europe聽were to plough 4.8 billion euros ($6.1 billion) into stakes in Dutch operator聽KPN聽and Telekom Austria, on which he is nursing huge paper losses after their shares declined sharply in the past year.
Slim, ranked the world's top billionaire by聽Forbes聽magazine with a net worth of $73 billion, was brought in by one of聽Shazam's venture capital owners, Silicon Valley fund Kleiner Perkins Caufield & Byers.
British-based聽Shazam聽will use the funds to accelerate its expansion into television, where its recognition software can tune into an advertisement's soundtrack then link viewers directly to the brand's website.
It wants to establish the offer in Britain and the rest of聽Western Europe聽and聽Latin America.
"Within 18 months we expect TV will significantly outperform the music side (of the business) and that's part of this investment,"聽Andrew Fisher, executive chairman of聽Shazam, said in an interview.
聽HUGE OPPORTUNITY
Blue-chip brands such as聽Unilever,聽Procter & Gamble聽and American Express are among the companies who have already used聽Shazam聽in advertising campaigns in North America, where the company generates tens of millions of dollars in revenue from the TV side, Fisher said.
Given that global TV advertising spending totaled $350 billion in 2012, according to researchers Nielsen, the scale of the opportunity for聽Shazam聽is huge, said Fisher, who hopes the TV business will help build the company into one suitable for a stock-market listing.
"That's our ambition, to list ... Certainly, two years' time is realistic," he said. The company's products are already used by 350 million people.
America Movil has also agreed to promote聽Shazam聽across the dozen or so markets it operates in聽Latin America. "Shazam聽is defining a new category of media engagement that combines the power of mobile with traditional broadcast media and advertising,"聽Slim聽said in a statement.
Slim's investment takes the total backing that聽Shazam聽has secured since 2009 to $72 million.
The billionaire businessman's empire of phone, construction and banking companies often expands by buying stakes in small companies. Earlier this year, Ora.TV, a fledgling online digital television network funded by America Movil, bought TV production company聽Stick Figure Productions.
Separately,聽Slim's聽Grupo Financiero Inbursa, which runs an investment fund managing about 5.15 billion pesos ($394.1 million), has invested in companies from film financier Movie Risk to natural gas company聽Gas Natural Mexico.
