Exploring API Side-Hustle Ideas— Part 1: What is an API?
There’s a market for solving problems.
In this article, I’ll broadly cover what an API is, and how it can be monetized. In subsequent parts I’ll dive into specific areas of the API marketplace, giving some potential project ideas that you might be able to springboard from.
- Part 1: What is an API?
- Part 2: Sport APIs
- Part 3: Finance APIs
- Part 4: Travel APIs
- More Coming Soon…
Some Background
Like most of us, last year I had a lot more free time than I had planned. Desperate to fill that free time with something remotely productive, I began developing APIs in my spare time. Now, a year later, with a fair bit of experience of working on both good and very back projects, I’d like to share some insights and ideas that I’ve gathered.
What is an API?
In its simplest form, an Application Programming Interface (API) is a service that receives some requests and replies with some responses. Often used by developers, an API is an effective way for a project to outsource certain elements to a third-party service. Allow me to give a brief and potentially lousy real-world example to show how I now consider APIs:
We (the user) are at a bar, and we talk to the barman (the API) in order to make a variety of requests:
- What beers do you have?
- Can I have a beer?
- Are there any tables free tonight?
- Can I book a table for next week?
The barman provides an interface for these requests, he then wanders off and does the work, and finally, you’re given a response in the form of your beer, a table reservation, or “I think you’ve had enough for tonight, mate”.
Importantly, the customer does not need to learn how to pour the perfect pint, nor do they need to trawl through the booking system to get a table. This is all handled by the API. The barman removes a lot of the complexity of my trip to the bar, and as such, they are monetarily rewarded for the excellent service they provide.
What Makes an API Successful?
Value
As evident from the example above, customers are willing to pay for a service that gives them value. The users of APIs are often those that are trying to complete their own, larger, project. The value here is often found by answering the question, what can I do to help?
As an example, let’s imagine that someone is trying to create a web-based tour company of the future. Users will be able to search for things to do, book tickets, and plan their trip. How can you help?
- How about an API that trawls google to find local places of interest?
- A currency converter so users can see the prices in their preferred format?
- An API that will schedule text messages to be sent so users are reminded of their upcoming itinerary?
Just for this one example, there are hundreds of potentially useful services you can provide to give value to the customer's project.
“During the Gold Rush, most would-be miners lost money, but people who sold them picks, shovels, tents and blue-jeans made a nice profit“ — Peter Lynch
Scale
Like all great ideas, the best APIs are often the simplest. An API does not need to solve thousands of complex problems to be successful. In fact, I’d argue that having a wildly out-of-control scope is a recipe for failure. The key instead, is to focus on providing value to someone instead of everyone.
API Monetisation
With the right idea and a target audience in mind, there is certainly the potential to earn some money once an API is released. There are 2 potential avenues you can take to monetize your service.
API Marketplaces.
API marketplaces remove a lot of the additional hassle required to release the API publicly and start earning money from it. From a technical point of view, this is the authentication, rate-limiting, and handling of transactions which can be time-consuming and costly if implemented incorrectly. There is also the additional benefit of free exposure that a marketplace such as RapidAPI can provide for your API. Depending on your service, your target audience may already be using these marketplaces, thereby removing the need to worry about SEO and other forms of marketing.
Of course, all good things have their downsides, and these marketplaces are no different. Firstly, the service does not come without a cost, you’re likely to forfeit a percentage cut of your earnings, typically around 20% for platforms such as RapidAPI. Seasoned API veterans will also warn of the dangers of relying too heavily on any third party. Any outages or downtime that these platforms suffer will ultimately affect your customer's access to your API.
Flying Solo
If you’re keen to go it alone, you can avoid any unnecessary expenses entirely by implementing everything from scratch. This has the obvious benefits of reducing costs and limiting your reliance on others. This path is often taken by pre-existing services that already have a solid user base and brand. For these individuals, when adding an API to their existing offerings, the exposure gained from API marketplaces is unlikely to match the traffic they can obtain from traditional marketing and SEO.
Hopefully, this article has provided a brief introduction to the world of APIs. In the remaining parts, I’ll look in more depth at different areas of the API marketplace, learning from what already exists to predict what might be successful in the future.
- Part 1: What is an API?
- Part 2: Sport APIs
- Part 3: Finance APIs
- Part 4: Travel APIs
- More Coming Soon…
