The Rise of Vertical APIs

This post is part of our series covering the API and SaaS world. You can find all our stories on the P9 Medium Channel. And if you like it please hit the recommend button 👍🏽

An important trend currently shaping the SaaS industry is the explosion of vertical (a.k.a industry specific) software. More and more verticals are getting SaaS-ified due to the maturation of the market.

This is also happening in the API industry. APIs are not only getting accessible to more users, they are also expanding to plenty of verticals by offering industry specific products.

As an illustration of this trend here is a short list of vertical APIs:

Real Estate

• Retsly, acquired by Zillow in 2015, was a tool to “help developers access real-estate data from multiple listing services (MLS).”
• RentWatch: “The Rentswatch API lets you access the largest database of rent prices in Europe”
• AeroState: “Worldwide air quality forecasts at city-block resolution.Distributed through API.”

Logistics

• Onfleet: “Manage and analyze your local delivery operations”
• Simpliroute: ”Optimize your delivery routes”
• Aftership: “Track shipments of 350 couriers”

eCommerce

• Semantics3: “Supercharge your business with ecommerce data on tap”
• Motlin: “The quicker way to build eCommerce applications.”
• Commercejs: “Full-stack eCommerce API for developers & designers”

Travel Industry

• Zumata: “get access to over 400,000 bookable hotels with our API Powered By IBM Watson“
• Waynaut: “Waynaut provides #MultimodalTravel solutions by combining all means of transport in one search.”
• Allmyles: “the very first full featured API consolidator of global bookable travel content”

Healthcare

• Eligible: “Payment Infrastructure for Healthcare”
• Infermedica: “Empower your healthcare services with intelligent diagnostic insights of Infermedica API”
• BetterDoctor: “BetterDoctor API. The best doctor search for your apps”

Fintech

• Plaid: “Plaid enables applications to connect with users’ bank accounts”
• Alloy: “Identity verification APIs that make KYC/AML effective and simple”
• Seed: “Modern Banking for Small Business“

On-demand economy

• Dispatch: “Book, track and manage with the world’s most powerful on-demand services platform“
• Mango Pay: “End to end payment technology for marketplaces”
• Onfido: “Background checks that scale with your business via online dashboard or API“

Agriculture

• aWhere: “We capture over a billion points of data across the planet each day to create unprecedented visibility and insights from farm level to national policy.”
• Terravion: “Aerial imagery for farming”

By no means I pretend that this is an exhaustive list nor that it covers the main players. The point was just to check whether I could quickly find APIs in the selected verticals. There is one vertical for which I had problems finding some: Legal Tech. Please drop me a Tweet (@clemnt) or a comment if you know some.

Observations

Here are several observations about this trend.

Vertical maturity

The big question here is whether the timing is good and if a vertical is ready to witness an API invasion or not. As I wrote in the intro this trend is already happening for SaaS in many verticals, and I believe that API companies need a market a bit more mature than SaaS companies do (first SaaS then APIs, but this order might change in the future). Here is what the industry digitization index looks for several verticals / industries:

I could find vertical APIs in most of them but market maturity is still very uneven.

Types of APIs

Concerning the types of vertical APIs, two types stand out:

• Data APIs: startups which collect industry specific data and monetize their access.
• Infrastructure APIs: APIs which enable users to build industry specific compliant products. Ex: TrueVault an HIPAA compliant API to store health data.

I think this is due to the current level of maturity of vertical APIs, once the market becomes more mature we’ll see more diverse types (ex: Feature as a Service APIs)

Customers / Users

Another observation I made was about the customers / users of these APIs. When we say that APIs or SaaS are eating a vertical there is a notion of “disruption” or at least of “change”. These solutions comes to improve the current situation.

But looking at who these APIs were serving, I could notice that many of them targeted both the “disruptors” and the “disruptees” (boy I don’t like to use the words disruptions / disruptors / disruptees but I couldn’t find an alternative).