API Lifecycle Management

The API Tooling Landscape


This article is about the API industry tooling landscape that every API product manager and tech manager should know or must know about APIs. There are around 1200 tools in the landscape that can help you to build API. You can design, document, develop, test, secure,  manage versions, and promote APIs to your community. 

This landscape is composed of five main parts. 

  • API Lifecycle platforms
  • Backend building tools
  • API-as-products / business processes as-a-service.
  • Integration-platform as a service. 
  • Vertical API abstractions and API aggregators 

With these five big layers and their subsections, you will be able to understand the full landscape.

Let’s dive into that landscape and see what the trends are.

API tooling is a $174.5 billion industry. The majority of tools are in the business processes as an API or API-as-a-product segment.

Of course, you have the pure transversal and horizontal API tools, but you also have pure products replacing business necessities over time. So this section is growing at a faster pace compared to other sections.

API lifecycle platforms

You can have API consulting, API management, design, documentation, access and identity management, testing, and security under API lifecycle platforms. We can also have IoT platform network devices, API analytics, monitoring APIs, streaming and event-driven architecture, and a developer portal. The full lifecycle can be represented in this section. In this segment, funding is large in the API management space. Companies like IBM, Sesedia, Postman, Provonix, etc., are part of this tooling. This type of tooling is important for the industry.

Backend building tools

There are around 200 backend building tools. These are mostly infrastructure, cloud, serverless, some dedicated industry backend like banking and finance, some backend for deploying just APIs, like database-as-a-service, some headless CMS, mobile backend-as-a-service, and blockchain APIs. The funding is mostly on infrastructure and cloud in serverless because of this wide capability. For example, we can also see traction in a new aspect like blockchain APIs. Some companies in this space are Cloudflare Workers, LUXHUB (backend for building bank APIs in a bank developer portal), and Strapi (a headless CMS that will help you to build any content-based website which is API driven and API first and API powered). 

API as a product aspect / Business processes as-a-service

We see many products in this segment. Every business process and industry can be represented in this segment. This segment is also growing fast. Even this landscape cannot cover them all. But it’s all about transactional APIs like emailing or SMS or payments. It’s about e-commerce, AI, Calendar API, API to provide forms, and API to provide human work (legal or regulatory). In terms of funding, the king of the business process that is API powered is payments. The second main player is email and messaging.

There are many opportunities for entrepreneurs to build APIs as business processes. For example, Twilio for communications, Algolia for search engines, Primer.ai for natural language processing, Stripe for payments, and Mailchimp for emailing. 

Integration plan as a service

We can see finance aggregators, automation orchestration platforms, database-as-a-service, or API aggregators. The landscape is funded mostly towards automation and orchestration compared to others. 

Vertical API Abstractions

It has around 80 industry- or sector-focused products, like healthcare, marketing, finance, delivery, transport logistics, smart home facilities, or Cloud Storage. 

Funding for this sector is primarily in abstractions for finance, mostly because of regulations obliging it. 

A few examples are HumanAPI (a health data resources API for clinics and variables and insurance platforms), Okta ( aggregation API), and Segment (acquired by Twilio for $3.2 billion – a marketing and customer data platform API).

API Management has become a commodity linking leading to new open-source growth.

Market research estimated the value of the API Management Market at $1.8 Billion in 2020 and is projected to reach $13.56 Billion by 2028, growing at a CAGR of 28.77%. The adoption will be huge.

Google has acquired “AppSheet,” which had acquired “apigee,” which had acquired “usergrid,” which had acquired “Firebase.”

There is huge consolidation in the market of the top players because every solution vendor and software company wants their API management solution. So this is a sign that it’s a commodity. Because it is a commodity, and every software player has it, this is where innovation takes another path. This way, we’ve seen many open-source API management providers. We’ve seen old ones, like Red Hat and more recent ones like Gravitee, Kong, and Tyk, that delivered a specific API management product. These companies have raised a huge user base. The open-source aspect is extremely important. The API tooling stack is more open source, and these companies are powering it. 

Trend 1: Explosion of tech regulations set to impact the API Industry.

Many countries have regulations on APIs. The main one concerns open banking regulations, obliging banks to open APIs. Europe has led with PSD2 regulations. Many places in the world are pushing for APIs, not only in banking but also in healthcare, mostly powered by the US. Regulations are also in place about data portability. So, if you want to open APIs for users, you have to follow these regulations.

Trend 2: Emergence of industry-specific solutions in banking, government, insurance, and healthcare.

Of course, when sometimes there’s a regulation, there will be a dedicated solution. Banking, finance, insurance backends, or API aggregators for finance represent almost 132 tools. 

For example, Axway has piloted an open banking platform in Brazil.

WSO2 got funding from Goldman Sachs bank to extend their banking-specific open source solution. A more recent network called the Open insurance initiative has many insurers or insurer tech companies who want to open APIs as a whole industry before regulations. Now, some companies are providing dedicated solutions—for example, the open insurance initiative. 

Trend 3: API Security is now a standalone product. Privacy is the next differentiation maker.

Some people are obliged to open APIs because of regulations or the COVID-19 crisis. API security is now a standalone product. 

Earlier, we had the DevSecOps approach, where we could shift left and shield, putting the security directly into the developer workflow. But, in the past three years, APIs have opened up without being monitored or managed and cannot be governed.

That can lead to data leaks and cyber threats. Security is key, and we can see dedicated solutions for the same. There are 33 dedicated API Security tools in the landscape. Funding for these tools is nearly 100 million, and it’s trending. 

Trend 4: APIs are a new layer of business and tech infrastructure.

Jeff Lawson of Twilio said, “The world is getting broken down into APIs. Every part of the stack of business that a developer might need to build is eventually turning into APIs that developers can use.” You can see this as a global supply chain of digital goods, all connected and programmable via their APIs. The payment, the emailing, the search engine, and the map APIs are all pieces that will enable you to build an application that you will assemble yourself. There are around 374 tools in this section. The top companies in this segment are Stripe, Twilio, Adyen, and Plaid for banking, SendGrid for emailing, and Avila for tax calculation. All these processes are being amplified. So before you build your business process as a service, check if there’s an API that can do that. This is also enabled because we have standards pushed by an Open API Initiative, like the open API specification, async, JSON schema, Graph QL, and many more. We can build more as a global supply chain because we know any API we build will be easily integrable by others because we respect standards. 

Trend 5: Low code and the growth of citizen developers are enabled by APIs

There are 39 tools in this segment. These are video, automation, and orchestration tools. e.g., Zapier, Retool, AppSheet. The drivers are mostly IT teams who want to be able to have these useful APIs to be able to do the job.


    • API management market is growing fast by becoming a commodity, creating open source communities and new companies.
    • Regulations are enforcing the publishing and the use of APIs. They are creating new opportunities for a company to build a solution dedicated to this industry or for existing players to build products dedicated to it.
    • Specialization of API Management in a specific industry is the new competitive advantage (banking, healthcare)
    • API security is now a standalone product. 
    • APIs are the new business infrastructure and the new technical stack.
  • Citizen developers are the next API users and consumers.
Mehdi Medjaoui
Mehdi Medjaoui is the founder of the worldwide apidays conferences series he started in 2012 in Paris. Mehdi is highly involved in the API community and API Industry, as author, lecturer, consultant and investor in the API tooling space. His industry research involves publishing and maintaining the API Industry Landscape and the yearly State of Banking APIs. In 2018, he publishes as co-author "Continuous API management" (O’Reilly) and begins as lecturer and invited professor at HEC MBA and EMLyon Executive MBA. In 2019, Mehdi become H2020 European Commission expert to lead the APIS4Dgov study on public sector and government APIs. As entrepreneur, Mehdi co-founded in 2014 OAuth.io, an API middleware for OAuth intégration used by 40,000+ developers that has been acquired in 2017. Mehdi’s new venture GDPR.dev develops a Personal data API framework and protocol to democratize data regulations usage for mass users and compliance for applications developers, making GDPR programmable.

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