Postman Valuation: API Platform Reaches $5.6 Billion

Postman Secures $225 Million, Valuation Soars to $5.6 Billion

Postman, a San Francisco-based company operating a collaborative platform for API development, has announced a new funding round of $225 million. This investment elevates the company’s valuation to $5.6 billion, a significant increase from its $2 billion valuation just one year prior.

Series D Funding Details

The Series D financing round was spearheaded by existing investor Insight Partners, based in New York. Additional participation came from Nexus Venture Partners and CRV, also existing investors. New investors, including Coatue, Battery Ventures, and BOND, contributed to the round, bringing the total funding raised across all stages to over $430 million.

The Importance of APIs

APIs (Application Programming Interfaces) are essential for connecting applications, both internally and externally, for developers. For a long time, this process lacked streamlined solutions. Previously, developers often relied on open-source command-line tools like curl and HTTPie, though Postman now faces competition from companies such as Stoplight and Kong, which is backed by a16z and Tiger Global.

From Chrome Extension to Industry Leader

The origins of Postman trace back to Abhinav Asthana, a former Yahoo intern who initially developed a Chrome extension to address his own frustrations.

He quickly discovered a widespread need for this solution among other developers and organizations.

Today, the six-year-old startup’s platform is utilized by over 17 million developers and more than 500,000 organizations globally, including major players like Microsoft, Salesforce, Stripe, Shopify, Cisco, and PayPal.

Fortune 500 Adoption

Postman boasts an impressive customer base, with co-founder and CEO Abhinav Asthana revealing that 98% of Fortune 500 companies are now customers.

Asthana previously emphasized the fundamental problem Postman solves for the technology sector, noting that larger companies often move slower due to competing priorities.

He recently stated that every company, across all industries, utilizes APIs and requires a robust API platform, a trend that is accelerating with the growth of cloud computing and digital experiences.

Market Leadership and Revenue

Postman currently holds a leading position in the API platform market, which explains the strong investor interest. While the company has not disclosed its revenue, sources indicate the new funding round was secured at a multiple exceeding 100 times the company’s revenue.

Expanding the Ecosystem with the Public API Network

While initially focused on providing tools for developers, Postman recently launched a public marketplace to facilitate the discovery and use of pre-built APIs.

“The Postman Public API Network connects millions of developers worldwide, offering a dedicated space for discovering, exploring, and sharing APIs,” explained Asthana. “This initiative was driven by the introduction of public workspaces, enabling collaboration across organizations.”

Empowering a New Generation of Developers

Asthana believes the rise of APIs will empower a new wave of “no-code” and “citizen developers.” Postman aims to foster innovation by making API technology accessible to individuals with diverse backgrounds and varying levels of technical expertise. Increasingly, professionals in roles like sales, marketing, and finance are becoming comfortable with APIs and championing their use.

Future Plans and Investment

With a team of over 425 employees, Postman intends to use the new funding to expand its workforce across sales, marketing, product, and engineering departments.

Significant investment will also be directed towards broadening the platform’s capabilities. “We are expanding the Postman platform to meet the needs of both technical and business users,” Asthana stated. “We are investing in supporting workflows for all types of APIs – private, partner, and public.”

Roadmap Highlights

Upcoming features include a new version of the Postman API, support for protocols like gRPC and ProtoBuf, and enhanced capabilities for GraphQL.

The company is also prioritizing integrations with other software development lifecycle tools, such as AWS, GitHub, and GitLab. Furthermore, Postman is releasing its Flow Runner tool, a no-code API composition tool designed to enable users to build API-driven programs.

Postman also plans to support students through API literacy programs and contribute to open-source projects.

Investor Confidence

Jeff Horing, Managing Director at Insight Partners, stated, “APIs have become the fundamental building blocks of software used by developers globally, and Postman has established itself as the preferred platform.”

He added, “Postman has the potential to become a critical component of how enterprises build products, deliver services, and forge partnerships. Their rapid growth and strong leadership team suggest a future with virtually limitless potential.”