Posted by: costanoa | April 24, 2013

APIs are Eating the World

We are excited to announce our investment (along with Javelin Ventures) in 3scale, a leader in API Management.  We’ve been very impressed watching Founder/CEO Steven Wilmott and team build the company and work diligently to find product-market fit.  We believe they have the right product at the right time.  It is the only developer self-serve product on the market, requiring no interaction with salespeople to get started. It is a freemium product, delivering substantial value at no cost.  It is highly scalable and configurable, adds no latency and avoids putting an additional vendor (and potential point-of-failure) *between* a platform and its customers/partners.  It is the least expensive commercial solution on the market.  We’re voting with our feet and joining the 3scale team with full-throated enthusiasm.
 
My friend and Netscape Co-Founder Marc Andreessen famously wrote in 2011 that software was eating the world (http://on.wsj.com/ZjM0C8).  Just two years later, it looks like APIs are taking over.  it used to be that software companies divided fairly cleanly between “platform” companies and “application” companies.  These days, if a company is in the software business, it must have a strong API to expose its features and capabilities to its partners and customers.  If a company’s product collects data, making this data available to analysts through an API let them add value to its customers.  Johnson Controls (a 125 year old company founded by the inventor of the thermostat) rolled out such just a platform product using 3scale in 2012.
 
This is a fascinating time in the API Management space.  Mashery (a cloud-only solution which stands between a platform and its partners) was acquired by Intel this week.  Layer7 was acquired by CA this week.  The Programmable Web (a thought leading web site) was acquired by MuleSoft this week.  These major companies are seeing the momentum in the market and have become believers that is can be a large and highly strategic market.  We agree.  But we think a developer-friendly, self-service and highly scalable product with a freemium approach is a unique and much-needed offering. Give it a try and let us know what you think.  

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