The API Economy (with speaker notes)

THE API ECONOMY Exploring the reinvention of business by

API’s and software developers

James Parton Ignite Keynote, 15th March 2016

Privileged & Confidential, Copyright 2016 Twilio Inc.

A LITTLE ABOUT ME

2

20 years at the intersectionof telecoms & the web

6 years actively supportingthe community

@jamesparton | [email protected]

Privileged & Confidential, Copyright 2016 Twilio Inc. 3

In computer programming, an application programming interface (API) is a set of routines, protocols, and tools for building

software and applications.

DEFINITIONS - AN API


THINK BUILDING BLOCKS

APIs are the building blocks that are the raw ingredients of innovation because they enable developers and organizations of any size to rapidly build new ideas.

The sum is greater than the individual parts - think lego - modular, flexible. You can build thousands of unique things with the same basic blocks.


A process or system by which goods and services are produced, sold and bought in a

country or region

DEFINITIONS - AN ECONOMY


A set of business models and channels based on secureaccess of functionality and exchange of data to an ecosystem

of developers and the users of the app constructs they build —through an API, either within a company or on the Internet with

business partners and customers

DEFINITIONS - API ECONOMY

There are no geo or political boundariesThe ‘Goods’ are API calls, software to software, with no human interactionThe enablement of other goods / services is the end game


An invisible revolution

THE API ECONOMY

As i mentioned in the definitions, much of the API economy happens ‘under the hood’, software to software, with end user being unaware of how, they just experience the benefits

Consequently many of the API power houses are not house hold names


AND ITS A WILDFIRE

$680m raised

Source: businessinsider.com, 18/12/15

Interesting Business Insider article in December which picked up on this - the 9 startups that secretly run the internet.

They are all developer focused, with an API at the heart of their product delivery.

Just this half dozen have raised over $600m - US VC’s in particular are switched onto platforms & ecosystems powered by APIs


THE NEW VALUE CHAIN

API API

Source: Sam Ramji ‘Darwins Finches, 20th Century Business. and APIs’

You have to ensure you remain in the modern value chain

The primary interface between the provider and the developer, and the brand and the consumer is the API


CONNECTED APPS AT THE HEART OF MODERN BUSINESS

“We are moving into an age of extensible apps and Slack is likely the new norm for software businesses.

In the earlier days of the Internet, applications could stand alone, but now they are expected to not only connect and share information, but extend their functionality by connecting with other apps.”

- Jack Berlin, CEO of Accusoft.

Source: forbes.com, 30/11/15

Another interesting article, worth reading is from Forbes…

I love this quote from Jack Berlin.


BUSINESS IMPERATIVE

“Today, a firm without application program interfaces (APIs) that allow software programs to interact with each other is like the internet

without the World Wide Web. “

14,700 APIs listed

REVENUE GENERATED via APIs

50% 90% 60%Source: hbr.org, 07/01/15

Harvard Business Review is also writing about the API Economy.

They say….quote

To give you an idea of the scale of change…programmable web

And this is driving the bottom line - % of revenues.


So why now?

THE RISE OF THE API


AN ABRIDGED HISTORY

SalesForce7th Feb 2000

eBay Developer20th Nov 2000

amazon.com Web Services16th July 2002

Source: apievangelist.com

Well actually APIs are long established in the IT world.

Things got interesting, and the API economy started, when the shift to modern web APIs, exposed externally from the organisation started.

Visit apievangelist.com for more


What were the triggers?

THE RISE OF THE API


The maturation of the web and cloud stack

Rabid demand from Tech Start Ups

Enterprise reinvention

THE RISE OF THE API

The modern tech stack - RESTful API design, Programming languages, Cloud

The rapid rise of API powered startups - flexibility to build businesses on API platforms - they can focus on the problem they are trying to solve. Mention Go Cardless.

And enterprise needing to reinvent how they do business and add speed


THE NEED FOR SPEED

Source: CEO Keynote I Love APIs 2015: Chet Kapoor Apigee

The rules have fundamentally changed.

Startups need to build and grow fast for hyper growth

Enterprises want the agility of start ups


26 million developers by 2019

THE RISE OF THE DEVELOPER

Start Ups Enterprise

Technical co-founders Bring your own device Bring your own service

Build vs. Buy is natural - differentiation is key

The speed of change has far out paced procurement

Focus on the problem they are trying to solve Transformation of Digital Agencies

Speed of change has far outpaced procurement, even the IT department?


CASE STUDY #1

• Needed a solution for beat police to communicate with Neighbourhood and Farm Watch groups

• Support channels the public wanted to use. Special consideration for rural areas with limited mobile internet

• Single platform covering all communication forms for a better customer and user experience

• Built by a team of in-house developers - vendor solutions too bloated and expensive

• 28,000 people have used the service generating 260,000 SMS & 20,000 call minutes.

• Cost per digital interaction of 30p vs £5 for traditional call centre

Launched June ‘15


CASE STUDY #2

www.parkinsonsvoice.org

www.ted.com/talks/max_little_a_test_for_parkinson_s_with_a_phone_call

Over 6 million people are currently diagnosed with Parkinson’s diseaseThe vocal fold displays tell tale tremorsDeveloped algorithms that can analyse fluctuations, tremors and other symptoms in recordings of the human voiceMass data collection project to collect 10,000 voice recordingsRemote, non intrusive identification of the disease and severity - 30 second phone call replaces a $300 clinical test


Some food for thought

THE HOME STRAIGHT

Thought I would wrap up by putting together some statements to provoke some thoughts.


Who could have predicted the worlds largest book seller would be hosting a ⅓ of all internet traffic,

earning them $6Bn a year,And all in the space of just 9 years?

FOOD FOR THOUGHT


The time between identifying a business need and delivering the IT solution to address it will become

hours and days rather than months and years.

No matter what the area, those who look to software solutions will outmanoeuvre those who look to

monolithic platforms.

FOOD FOR THOUGHT

Cloud will win - rapid procurement, scalability, adaptability, cost savings.


Complacency has never been so dangerous

Think at scale

Differentiation is built:75% of all app purchases will be build by 2020

FOOD FOR THOUGHT

Source: Gartner, Enterprise Application Software, Worldwide, 2Q15 Update

Competitive plays can now launch in months

You have to build for differentiation. How can you stand out if you are buying the same solutions from the same vendors as your competition?


2000: Rent by the year2003: Rent by the month2008: Rent by the hour

FOOD FOR THOUGHT

Lets look at AWS again.

If you don’t believe me when I say complacency has never been so dangerous,

You think for one minute they have sat back and patted themselves on the back for the great job they have done?

They continue to disrupt themselves


What is your developer strategy?

How are you attracting developers to your brand?

Is your motivation genuine?

Traditional sales & marketing approaches are not appropriate

Is your success truly linked to the success of the developer?

FOOD FOR THOUGHT


FOOD FOR THOUGHT

Don’t buy into the clichés that your success with developers is linked to the volume of pizza you buy.

You have one shot to get it right

I’ve seen large companies thinking they need a hackathon, not being clear on why, and then asking their marketing agency to lead it. Recipe for failure.


FOOD FOR THOUGHT

hackdaymanifesto.com

Learn from the experts, and get them involved before you reveal anything publicly


The right business model is also the right motivational tool…

Twilio +69 NPS vs. +29 s/w industry average

FOOD FOR THOUGHT

TraditionalHardware

TraditionalSoftware Twilio

Multi-year Capex Maintenance Contracts Per seat licenses Pay as you go

Breeds complacency Customer Focused

You want your people coming to work everyday thinking about how they keep your customers happy


AND FINALLY - API’S READY FOR THE MAINSTREAM?

If This Then ThatA B2C API service - 293 APIs already integrated

Big focus on IoT and the smart home

And finally…

Smart home - Philips Hue, Nest, Hive - very hot right now (see what I did there) - and I believe a number of these companies are at the event.

Slides - bit.ly/apieconomyslides @jamesparton | [email protected]

mailto:[email protected]

The API Economy (with speaker notes)

Technology

Transcript of The API Economy (with speaker notes)