The CEO of RapidAPI, which just raised $25 million in funding, says its developer tool is seeing a faster rate of signups during the coronavirus crisis
- Developer startup
RapidAPIannounced a $25 million funding round on Thursday led by Andreessen Horowitz, DNS Capital, Green Bay Ventures, M12 (Microsoft's Venture Fund), and Grove.
- The company has seen a faster rate of signups during the coronavirus pandemic because of more people working remotely, RapidAPI founder and CEO Iddo Gino told Business Insider.
- The company will invest the new funding in its product and online marketplace, as it tries to work with larger companies.
The developer startup RapidAPI just closed a new round of funding amid the ongoing coronavirus pandemic even though it had plenty of money left in the bank.
It's platform allows developers to easily find, share, and use application programming interfaces (APIs) they need when building apps. APIs essentially allow products to access features or data from another app, like how Uber and Lyft use Twilio's APIs to allow drivers make calls and send texts, while Spotify and Tinder use Facebook APIs for logging in.
On Thursday, RapidAPI announced a $25 million Series B funding round led by Andreessen Horowitz, DNS Capital, Green Bay Ventures, M12 (Microsoft's Venture Fund), and Grove, bringing its grand total to $62.5 million in funding. While RapidAPI declined to share its current valuation, it said that its Series B was not a "down-round," meaning that its valuation is now higher than it was after its last fundraise ($80 million).
RapidAPI plans to invest its new funding in engineering and growing its online marketplace, which now has over 20,000 APIs used by over 300,000 developers. It's also focusing on working with larger companies.
While RapidAPI still had most of its money from its last funding round in June 2019, founder and CEO Iddo Gino said the company decided to raise more money to speed up the its growth. It also wanted to take advantage of interest at a time when investors are generally feeling cautious, and other startups are cash-strapped.
"There was some uncertainty we saw around where we were going with the virus," Gino told Business Insider. "Given the opportunity to raise, we figured it was the right thing to do."
While the process had its difficulties, since Gino couldn't meet investors in person, it took less than two weeks from start to finish, he said.
The coronavirus crisis seems to be driving growth for RapidAPI
While many companies have taken a hit during the coronavirus crisis, RapidAPI saw a faster rate of new signups in March and April that it did in the earlier part of the year, Gino said.
He believes that that's because many engineering teams are pushing out new software more quickly now that they've moved to remote work. Also, RapidAPI targets customers in industries like financial services, insurance, and e-commerce, which haven't been as impacted by pandemic. The company has had 30,000 paid subscribers sign up this year, and its product RapidAPI for Teams, which helps teams share and collaborate on APIs, is now used by more than 18,000 teams, with more than 1,000 new ones created every week.
Still, the company isn't resting on its laurels and Gino knows that the coronavirus-related uncertainty is real.
"The first quarter of the year for us was really strong and we are able to go above the initial projections we have," Gino said. "But I think for now, things are a bit influx to understand how this will evolve. Our business is going strong so far but there's a component of uncertainty about what the rest of the year will look like from a macroeconomic perspective."
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