Oh API day: 3scale raises $4.2 million to bolster its API management solutions

3scale, the API management solutions provider that splits its offices between San Francisco and Barcelona, has scored $4.2 million in new funding from Javelin Venture Partners and Costanoa Venture Capital.

It’s been quite a busy two weeks in the wonderful world of APIs indeed. First, Intel bought one of 3scale’s main rivals, API management service Mashery, and then CA bought another, namely Layer 7.

If that weren’t enough, integration software firm MuleSoft also recently raised $37 million and announced yesterday that it was buying online API and mashup directory ProgrammableWeb from Alcatel-Lucent.

What does 3scale do?

3scale essentially enables companies to distribute, manage and monetize their APIs – for many of its clients a key component of their businesses – via its ‘Freemium API Management’ offering, providing the needed infrastructure to manage the technical and business operations of things.

The company says it differentiates from competitors because its API management platform is immediate, self-service and practically costs nothing to adopt.

Organizations can use 3scale’s solutions to run an API program from a free entry-level service all the way to Enterprise grade APIs for up to hundreds of millions of API transactions per day, all on a single platform.

3scale co-founder and CEO Steven Willmott tells TNW:

We see APIs as becoming fundamental to way business will be done on the web – they underpin mobile, partnerships, new types of data flows (e.g. SaaS vendors becoming platforms) and our aim is to facilitate that.

Our platform differs from Mashery, Apigee, Layer7 and co pretty radically in that it’s self serve and free to start.

Plus, you could genuinely run a meaningful API on our free system – which we’re committed to maintain free for ever. Hence, we’re aiming to enable broad adoption of APIs rather than focus on the high end enterprise niche the other players target.

Scaling 3scale

3scale’s API Management solutions already power APIs for over 200 customers – including the likes of Skype, Wine.com, FlightStats, FullContact and Yummly – serving over 85,000 application developers.

The company says it has seen the API traffic it monitors and manages more than double in the last 6 months.

Founded in 2007, the fresh cash will help 3scale expand its suite of services, hire more staff and boost its business globally by investing in additional marketing and sales efforts.

3scale previously raised $800,000 in 2010 in a round led by Inveready Technology Investment Group, but says it has been focused on growing the customer base until hitting break-even.

Willmott also tells me 3scale has had multiple acquisition approaches in the last 9 months – which isn’t surprising given the activity we’ve been seeing in this space in just the past weeks – that they always felt the right thing to do was raise funding to continue to build the company as APIs are just at the beginning of the curve of broad adoption.

Image credit: Thinkstock