RapidAPI has secured $150 million in a new late-stage funding round at a $1 billion valuation to support the growth of its API Hub platform, which helps developers find application components that they can use to build software.
Incorporated as R Software Inc., RapidAPI announced the Series D funding round this morning. The startup said SoftBank Vision Fund 2 was the lead investor. Qumra, Andreessen Horowitz, Microsoft Corp.’s venture capital arm, Viola Growth, Green Bay and Grove Ventures participated as well.
Most enterprise applications comprise not only custom code created in-house by a company’s developers, but also third-party software components. A workload interacts with the third-party software components that it uses through application programming interfaces, or APIs. An analytics tool, for example, might use an API to retrieve records from the database that it uses to store information.
RapidAPI operates an online marketplace where developers can access software components for use in their application projects. The software components are all delivered via APIs, which makes them relatively easy to integrate into applications. RapidAPI’s marketplace provides access to numerous APIs that simplify tasks ranging from processing payments to generating weather forecasts.
The company disclosed today that more than 4 million developers use its marketplace. For enterprises, the startup provides a commercial version of its platform that allows a company’s developers to more easily share application components with colleagues.
“The pandemic and the rapid change it has precipitated over the last two years has compelled almost every company to become a digital player very quickly,” said RapidAPI founder and Chief Executive Officer Iddo Gino. “It’s not a nice-to-have, it’s basic survival. Companies are turning to APIs and tools like RapidAPI to realize the productivity and innovation benefits of digitizing their organization.”
According to RapidAPI, enterprise deployments of its software nearly tripled in 2021 and more than 25,000 developers signed up for its paid product plans. The startup said that the increased demand helped it more than double annual recurring revenues over the past year.
RapidAPI’s sales growth is driven not only by the commercial version of its API marketplace, but also the API development tools that the startup sells alongside the platform. It provides tools that help developers create APIs for their applications as well as test them to ensure they operate reliably.
The company expanded its portfolio of development tools early last year by acquiring a company called Paw Cloud OU for an undisclosed sum. Paw developed a desktop application that simplifies the process of designing and testing APIs. The application has since been integrated with RapidAPI’s RapidAPI Client product.
The new funding round gives the startup the option to make more acquisitions. Following the investment, the startup plans to grow its presence in the enterprise market and enhance its API marketplace by rolling out more features.