Enterprise API management firm Apigee has littered the pages of the tech press over the last month with announcements of banner acquisitions, partnerships, and market expansion initiatives. Today, the company is adding to that list a funding announcement in a big way.
In the fifth institutional financing round completed over its eight years, Apigee has raised a $20 million round led by new investor Focus Ventures, with participation from current investors Bay Partners, Norwest Venture Partners, SAP Ventures, and Third Point Ventures. The round brings the company’s total funding to more than $72 million.
“APIs make the app economy possible,” says CEO Chet Kapoor. “We provide the doors to making apps successful.” The company’s more than 350 current customers, include 20 of the Fortune 100 such as Wallgreens, AT&T, and Telefonica. These enterprises use Apigee to develop and manage custom mobile apps, web platforms, and other digital tools which can be tapped into by third-party developers.
The company supports over 100 billion API calls per month within its platform. Wallgreens, for example, uses Apigee to deploy its one-click photo uploading and printing functionality from within the photo library on a user’s mobile device. Without this functionality, the app would be far more cumbersome and likely far less widely used.
“Apps are becoming the foundation of mobile computing as well as enterprise IT, and Apigee enables businesses to embrace the new economy built on APIs and apps,” says Norwest Venture Partners Managing Director Promod Haque.
With 240 current employees, Apigee succeeds on both scale and expertise according to its CEO. The company delivers solutions that its clients can’t or choose not to develop for themselves, often in ways that its competition cannot match.
Apigee reduces the complexity of delivering APIs and building apps which are the DNA of modern digital offerings. Without them, companies are at a serious disadvantage when attempting to reach and interact with customers in the ways they’ve come to expect. The “Apigee Enterprise API Platform” provides analysis and control of API usage, allowing its customers to better support developer adoption and scale as growth occurs.
While the company does not have a direct competitor at the moment, Kapoor says he would be shocked if the “largest enterprise companies” didn’t enter the market in the near future. The CEO says both he and his investors would welcome their entry and the market validating effect it would have.
With the additional capital in the bank, Apigee plans to accelerate its expansion into Asia-PAC and Latin America, as well as maintain its already “fairly significant” R&D spending, as Kapoor describes it. The CEO claims that outsiders will be surprised by the business model innovations it has achieved with international expansions to date, including the remote nature of its sales cycles and the limited need for on the ground teams.
Having completed two acquisitions thus far in 2012, it’s not a stretch to think that further M&A activity will be a part of the company’s growth plans. Kapoor hinted that this strategy may be used to rapidly expand into new vertical markets with industry-specific API solutions, such as the those recently acquired within the telecom sector.
Kapoor sees a world where the lines between the Web and enterprise are blurring rapidly. “It’s no longer just Netflix and Shazaam that are the forward thinkers,” he says. “Consumers are spending more time on mobile apps than on the Web. Every business – from technology start-ups to bricks-and-mortar giants — needs an API to compete in a digital economy.”
[Image courtesy of Apigee]