According to a TechCrunch report, Apple is set to acquire London-based Shazam. The deal is expected to be signed this week. TechCrunch cited an anonymous source as saying that the deal is worth around $400 million — which is far less than the post money valuation of more than $1 billion Shazam announced in 2015, after its most recent round of funding.
Apple declined to comment. Representatives for Shazam did not respond to requests for comment either. Apple would obviously want to use Shazam to bolster its music business and drive sales and subscriptions from users who “Shazam” songs. The two companies have had a longstanding business relationship, under which Shazam app users can click to purchase songs on iTunes that they’ve identified. Shazam’s features are also integrated with Apple’s Siri voice assistant.
Shazam was founded in 1999, and initially worked by using mobile phones’ SMS text-messaging features to identify a song. In 2008, Shazam was among the first apps in Apple’s then newly launched App Store.
Shazam’s app now allows users to identify and share audio, TV, printed, and augmented-reality content. In addition to its cooperation with Apple, Shazam allows users stream songs identified in its app through Spotify, Deezer, Google Play and YouTube. The company says that the app has been downloaded over a billion times by users in over 190 countries, and that users “Shazam” content more than 20 million times on a daily basis. For 2016, the company reported sales of $54 million and a net loss of $5.4 million, according to financial filings in the U.K. That’s compared with 2015 revenue of $47 million and a net loss of $22 million.
Shazam is a privately held company, whose investors include Kleiner Perkins Caufield & Byers, Institutional Venture Partners, DN Capital, Acacia Capital Partners, and Mexican billionaire Carlos Slim’s America Movil, along with Universal Music Group, Sony Music Entertainment, and Len Blavatnik’s Access Industries (parent of Warner Music Group). The company has raised over $140 million to date.