Shazam's CEO says the company could be an acquisition target now that it's profitable

Shazam was one of the winners of the early app rush. Its app had a simple function - identifying what song is playing - that's led to 1 billion downloads on iOS and Android so far.

Now Shazam is teaching its users what its app can go beyond song identification. For the past year, the company has been integrating a new technology called augmented reality, which it calls "visual Shazam," a kind of trendy technology that uses the smartphone's camera to overlay computer graphics and games into reality. 

Now, users can scan "Shazam Codes" - similar to a QR code or Snapchat's "Snapcodes" - and unlock deals, games, or other experiences. The first partner is Beam Suntory, the parent company of Jim Beam. 

The new feature has even led Shazam to redesign its app, according to CEO Rich Riley. "We started cautiously, with the camera on the top right corner. Now we've moved it to front and center," Riley told Business Insider.

Soon, he says, "brands will say 'Shazam this'" on print ads and other handouts. The example that Riley showed Business Insider had Wyclef Jean pop out of an invite to a South by Southwest party. 

Post-song recognition 

The Shazam Code integration is part of the company's new revenue strategy. Last year, the company pivoted away from selling songs and toward advertising as its main source of sales, Riley said. That change helped the company achieve profitability last year, he said. 

It's not the only new project the company has taken on in the last year. Shazam integrated with Snapchat in December, allowing users to identify songs in Snaps and stories by pressing down on the screen. 

Riley is thrilled with the consumer reaction. "What is the opposite of troll? That's been the user reaction," he said while scrolling through his Twitter likes and finding genuinely surprised and delighted users. 

Shazam's software will also star in a television show airing on Fox this summer, Riley said. Actor and musician Jamie Foxx will star in "Beat Shazam," a Mark Burnett-produced reality show that has contestants trying to identify hit songs before the Shazam algorithm can.

These partnerships are one way for Shazam to continue expanding its reach and create additional revenue streams as it prepares for a possible IPO, which has been discussed in the past year. Riley dismisses that an IPO is imminent, pointing out that the company's profitability gives it the flexibility to build to a standalone IPO, but also means that it's not necessarily in a rush. 

Shazam might also make sense as an acquisition target for a big company looking for a foothold in music or advertising, Riley said.