There’s a big but hidden business out there connecting corporate consumers of data with suppliers of data, and Seattle-based APImetrics has devised what it calls a better way for corporate consumers to be sure they’re getting what they pay for. The two-year-old company just got another $500,000 in funding from early investor Bain Capital Ventures to support its efforts.
The business is APIs (application programming interfaces). Once an acronym familiar only to developers, who used APIs to build applications on a given operating system, “API” is now a term known even in the C suite, and it has come to encompass accessing pretty much anything online, even software as a service like Office 365. It’s not a term, or even a concept, that most end-users at their laptops or on their smartphones will ever encounter. They’ll just see APIs working — or not.
Data generated by one organization and sought by another — whether it’s flight arrival and take-off times, weather, census information, or international banking figures — used be available on floppy disks. Then it was obtainable on web sites. Now corporate consumers of data and apps, who may use it themselves or pass it to end-users, often get it by means of an API. End-users, whether they know it or not, consume the data on their smartphones or computers via an API.
Those connections sometimes involves writing code that accesses a database and imports the desired data. Instead, or in addition, major companies use API-management firms such as Apigee, which Google agreed to buy for $625 million last month.
APIs have become a big business. Forrester has predicted annual U.S. spending on API management will more than quadruple to $660 million in 2020, from $140 million in 2014. Gartner’s 2016 magic quadrant ranks 19 “full lifecycle API-management” companies.
Walgreens uses Apigee to manage the APIs it shares with developers, including one for photo printing (letting mobile-app developers include the ability to print photos at a Walgreen’s store) and one for prescriptions (letting developers let smartphone users refill prescriptions).
As another example, by using APIs, Expedia accesses airline and hotel data that it then passes along to its end-users, as do competitors Orbitz and Travelocity. But in this example, how can those three companies be sure they’re getting data as fast and reliably as possible? The risk is that if their customers encounter delays due to slow or unreliable APIs — delays the companies might not even know about — then the customers may just turn to a competitor.
That brings us back to APImetrics. The startup offers a single number that both consumers and providers of data can use to assess the health of their APIs. That number, which the company calls a CASC (Cloud API Service Consistency) score, is calculated by a machine-learning algorithm. APImetrics co-founder and CEO David O’Neill in an interview called it “a credit score, a single trackable number that reflects how much time you’ll waste looking into problems reported by clients and users.”
The CASC score reflects an API’s uptime, the number of outliers (that is, deviations from perfect uptime and ideal speed) and the standard deviation of latency, among other things. A score of 800-999 reflects good basic performance, with perhaps a few issues per month. A score of 600-800 reflects average performance, yielding a dozen problems per month. Lower than 600 means multiple problems weekly. An arrow next to the score indicates whether it’s gone up or down since the API was last checked. Details are available in this paper.
Providing a single number to judge an API’s health simplifies life for both producers and consumers of data passed by API, O’Neill said. “We’re trying to take out the noise and allow a focus on the signal,” he said.
The company isn’t the only startup pursuing this concept. Marty Roberts, former co-CEO of Comcast-owned ThePlatform, recently launched API monitoring startup Wicket Labs, which acts as a middleman between premium video production companies and the multiple third-party API vendors they use.
APImetrics sells its service for $9,000 a year and up, depending on how many test API calls a customer wants to make. The company is generating $40,000 to $50,000 a month in revenue and is “very close” to being cash-flow neutral, O’Neill said. It has garnered a total of $1.5 million in funding and currently has staff of five.
“As we move forward, we want to provide service-level data to both consumers and providers of data, because we realize people don’t trust the people selling them something to tell them how well it works,” O’Neill said. “As we move into this world where you’re depending on third parties for things you need, you might want to double-check you’re getting what you expect.”
