To API or not to API?

APIs, or Application Programming Interfaces, are everywhere. According to http://www.programmableweb.com, there are over 15.000 providers of public APIs. That’s why more and more SaaS and other companies today are wondering if they should jump the API bandwagon. This post will briefly explain what an API is and highlight some of the business rationales why publishing an API alongside your (SaaS) software product might be beneficial for you. 

What is an API?

API stands for Application Programming Interface. In its simplest form, an API is a formal contract that allows one computer program to talk to another computer program, in order to exchange information. APIs are everywhere: operating systems provide APIs so that developers can build applications (e.g. browsers, office tools, etc.), applications sometimes provide APIs so users of the applications can build customizations (e.g. visual basic for applications to transform generic excel sheets into powerful bookkeeping applications), and more recently, web sites offer APIs so developers can build applications on top or alongside them (e.g. there are more than 1 million registered applications using Twitter’s API). This last type of API are technically speaking web services, but it is common to call them APIs as well. It is this kind of APIs that programmable web is tracking, and that is the subject of this blog post. 

To API or not to API?

Why would a company release a public API? Should all SaaS companies have APIs? The answer is, as always with non-trivial questions: it depends. 

Easy integration

Many SaaS vendors offer complex business process software: i.e. software that automates some business processes: from email marketing, to customer relationship management to invoicing and general purpose ERP. While most of this software provides enough configuration options out of the box, some customer’s needs might not entirely be covered. These needs are often related to integration with existing IT infrastructure:  often the customer wants to send data to and/or receive data from the SaaS product in order to build complex enterprise workflows. This is a use case where providing an API to the customer comes in handy: the customer now has a formal, supported way to connect her systems to the SaaS software, without the SaaS software vendor having to know much, if anything, about the system it is being integrated with. 

Platform strategy

Many SaaS and other online companies take this approach a step further: they look at themselves as a platform provider and offer API’s not only to facilitate one off integrations, but also as a means for 3rd party developers to build entire new applications, each with their own business model. Often, these companies even provide app stores as well. Twitter is an example of such a company: their API allowed developers to build apps on top of Twitter, both contributing to Twitter’s own position as a platform, as to their own business model. A company like Salesforce.com pioneered this approach in enterprise B2B with their force.com platform and their appexchange.com store. 

API first

Lastly, there’s even a generation of API first companies: payment provider stripe.com offers web and mobile payment for developers. The company’s product is an API. The entire functionality that stripe offers, is driven by API calls that developers make to their platform. In the last year or two, a rise of API first companies is seen, offering virtually everything-as-a-service, from billing, to sending large amounts of email, to checking if a VAT number is correct. API first companies cater towards developers, offering elegant, few-lines-of-code APIs and ready to use software development kits, together with top notch documentation so developers are up and running in literally minutes. 

So, what scenario is mostly applicable for you? Are you thinking about offering an API to ease the integration pains for your team? What would API first mean for your business? 
These and other questions will be dealt with during a 1-day masterclass on 15 June, in which you will get an overview of what it takes to build a business out of your APIs. Topics such as API design and best practices, API management, developer portals will be included. Interested? Click here for more information and practical details.