By standing on the shoulders of giants, we all have the possibility to disrupt markets and unseat entrenched incumbents. Cloud computing, mobile, and social have opened up unprecedented opportunity that we all have the chance to capitalize on. Market leaders like Amazon, Facebook, Twitter, and Twilio are using these disruptive technologies to form the foundation that we can build on to automate interactions between our networks and theirs.

These types of organizations are API platforms, but what is an API platform? We talk about API platforms so much here on the Nordic APIs blog and at our events that we wanted to define it clearly.

The Definition of an API Platform

An API provider is an organization that exposes data and/or capabilities through a programmatically consumable service or an Application Programming Interface (API). This organization is more than a provider and has become a platform when its API:

  • Enables access to the organization’s core value proposition;
  • Is technically and non-technically scalable;
  • Enables consumers to create shared value;
  • Is instrumental in securing the organization’s position as a market leader; and
  • Is seen by top management as business critical.

Elaborating on this Statement

An organization is an API platform if it exposes its resources and assets in a machine readable format to other members of the ecosystem. This allows those third-parties to build on the API platform’s core value and create new value for their customers.

An API platform is an organization which brings together two or more distinct, but interdependent, groups of consumers using APIs. This creates a foundation for automated transactions between different networks. The platform unlocks hidden value within the organization by exposing its core as an API. In this way, it acts as a centerpiece for open innovation, co-creation, and collaborative development. This facilitates an ecosystem effect where the platform becomes the basis on which others conduct their business.

Simply put, an API platform is:

  • A catalysts for growth
  • A hub for innovation
  • A co-creating ecosystem
  • An organization which has automated strategic partnering
  • An efficient system that adapts to its surrounding environment

Why be an API Platform?

To become an API provider can be challenging enough. Why would an organization strive to be more? Why invest in the people and technology necessary to become a platform? Business leaders are seeking to transform their organizations into API platforms because of their potential to disrupt entire markets. An API platform is necessary to pull off a platform business model (e.g., like Amazon’s and the others’ we mentioned).

What do you think? Did we correctly define what an API platform is? Let us know in the comments, on Twitter or on Facebook. In upcoming posts, we will incorporate your feedback as we delve deeper into the why and how of becoming an API platform. We will also give you more examples like LEGO’s journey toward platformification. To be sure and catch those as soon as they are published, subscribe to our newsletter. Before then, be sure to register for the Nordic APIs Platform Summit in Stockholm to discuss these things face to face in October.

[Editor’s note: Thanks to Kin Lane and Mike Amundsen for initial feedback and critique.]

About Travis Spencer

Founder & CEO of Twobo Technologies and a co-founder of Nordic APIs. An American living in Sweden and specializing in API security.

About Andreas Krohn

Working with API Strategy and implementations at Dopter.se. Co-founder of Nordic APIs. Blogging about APIs in Swedish at mashup.se.

About Rhys Fisher

Rhys is a digital marketer with a sharp focus on growth. He also contributes to Swedish Startup Space, and Medium.

Mark Boyd

About Mark Boyd

Mark Boyd is a freelance writer specializing in the API economy, with a particular focus on API business models, open data and civic tech.

  • matchist

    Travis, thanks for the great post. I think you did a good job of defining what an API platform is. I find that visual examples often help people more easily understand how APIs can help them.

    I wrote a post that provides some examples to supplement what you explained here: http://matchist.com/blog/what-is-an-api/

    In what way do you see APIs making the most impact for the average size business these days?

    • travisspencer

      Great post, matchist, and thanks for link.

      I agree that visuals, examples, and metaphors are helpful ways of communicating what APIs are and the benefits/functionality they can deliver. One analogy that we used a bit in this post and that I often turn to is the ecosystem. As in nature where animals of all sizes gather in life-giving Biomes, more and more organizations (many of them the average-sized business you mentioned) are gathering around major API platforms. These platforms are like the reefs or rainforests that provide life and substance to the other members of the habitat.

      I envision a future where more of these API platforms will come to be. As they do, companies, even small ones, will benefit from APIs — often without even recognizing that the benefit is coming from APIs. Like we are using Disqus (which we’ve integrated with WordPress via an API) to discuss this, average-sized organizations will transparently use APIs more and more; they will enjoy the benefits of them and grow to depend on their functionality. However, they will probably _never_ know what an API is or even care.

      Like a real ecosystem, these cyber-bio-systems will grow if their inhabitants/users can thrive. This means that API platforms must enable the success of their users, partners, and other constituents. This isn’t an easy thing to do, but it’s the opportunity that lies at the feet of anyone who recognizes what an API is and has the creativity to find ways to incentivise different stakeholders to join in. The great difficulty in pulling this off is one of the reasons that we focus so much on API platforms here at Nordic APIs.

      One good tool to help with this that I would recommend is the “framework” that Steffen Breinholt-Hedebrandt presented at our Platform Summit this fall. In his presentation, he talks about his experiences at Elance-oDesk and gives a model that can be used to balance the demands of a two-sided market (i.e., to bootstrap an ecosystem) using APIs: https://www.youtube.com/watch?v=1dL9jHVSHPw

      Thanks again, matchist, and please continue to join in the community and the discussion!