Keep calm and use an API

API t-shirt

A few years ago Ivan Jureta and I made an artificial intelligence startup. Our investors, who were financial and legal experts, insisted on a number of registered users as KPIs. However, we concluded that we could be far more successful if we rented our AI via an API.

While trying to get our own users, we also started looking for API customers. Soon we were negotiating with mobile apps which had tens of millions of users, needed our AI API to gain revenue, and wanted to share that revenue with us. API access revenue share would have been millions if not tens of millions per app. Unfortunately, our investors did not know what an API is and pulled out when we did not meet the registered user quota. As a consequence, we had to inform the mobile app we were negotiating with that we decided not to make millions for them and us. I have never witnessed a bigger business blunder in my life, nor has anyone else I ever met.

The most general point of the story is that investing in niche technology requires knowledge of niche technology, which is much rarer than media likes to show. Real understanding of technology is not something that is gained by reading magazines and buying tech gadgets. Just like Mozart, understanding of technology is something that is obvious at an early age.

More practical point of the story is that APIs are very important.

Data can be accessed either via the interface or via the API. The interface always has less data, is slow to use, dictates its own ideology, visualization, and experience, and is biased. APIs on the other side allow free and direct access to data and features. Most relevant organizations and apps allow APIs and the number of APIs will only grow in coming years.

APIs can, for example, allow access to third-party customer and partner data, automated purchases and advertising, or AI features as mentioned above. All of these are too hard to develop internally or impossible to access via the interface. Being able to access APIs makes the company much more competitive especially as digital content and sales grow in importance for the internal teams and customers.

Using and building APIs is a necessary component of growth. Companies that master it first will be drastically more competitive because entry-level resources to use APIs are higher than basic technologies. To use APIs companies must invest in highly skilled dedicated development teams which understand the niche business logic. Building such teams usually takes one or more years. The sooner the investment is started, the better.

It is impossible to explain how APIs can help grow a business in a single post. My goal was to spark your interest so you can slowly gain an understanding of “behind the interface” world of data and algorithms. There is much more to digital than what is seen on the screen.

Written by: Nikola Tosic
Publishing date: 5 Sep 2018