APIs continue to create tremendous value for organizations. In a recent article written for Nordic APIs, Mark Boyd considered the transformative power of cloud computing, and the disruption it is stirring in the corporate acquisition market. With today's ability to include location, payment, social networking, messaging, CRM, and more services into one platform through the use of specific APIs, these interfaces are playing a more important role in influencing corporate acquisitions, valuations, and garnering interest in new technologies.
In recent acquisitions such as Edelman's acquisition of Deportivo, Echo Nest by Spotify, Songza by Google, and Facebook's acquisition of Moves, APIs have consistently been addressed as having a large impact on company valuation. But what do business analysts look at to determine API valuation? According to Michael Skok, a venture capitalist partner at North Bridge, the reasoning behind API-centric corporate acquisitions can be boiled down to three main attributes. First, that the API is proof that the company being acquired is forward thinking, developing future-proofed architecture. Secondly, that the API provides the potential to foster an ecosystem of consumers, and lastly, that the robustness and efficiency of the API could aid or enhance a business's current dealings.