Technology startup API Kong Inc. today announced that it has closed a bumper $175 million late-stage funding round, bringing the total amount raised to date to over $346 million.

Today’s Series E round, led by Tiger Global and Balderton, brings Kong’s valuation to more than $2 billion. In addition to these backers, the round saw participation from new investors including Ontario Teachers’ Pension Plan and 137 Ventures, as well as existing investors Andreessen Horowitz, Index Ventures, CRV, Sapphire Ventures and Notable Capital.

Kong has created a suite of technologies to management of application programming interfaces and microservices and connecting the two natively in public clouds, Kubernetes environments, on-premises data centers and more.

APIs are key to modern applications, including next-generation artificial intelligence applications. Today, they are the preferred method for developers to expose data and services when building microservices-based applications in software containers that can run on any computing environment. According to Kong, APIs account for more than 80% of global internet traffic.

In simpler terms, APIs allow applications to communicate with other applications and services. For example, APIs make it possible to book a flight using an app like Skyscanner and have that reservation automatically appear in a calendar app.

With Kong Konnect, Kong helps developers simplify API management across environments with one-click deployment mechanisms. Having established itself as a leader in API management, Kong believes it will play a central role in today’s generative AI revolution, helping organizations build these applications faster while providing security, visibility and centralized governance.

To do this, it created a product dedicated to AI applications called Kong AI Gateway, which is a cloud-native open source gateway that makes it easy to deploy AI plugins and large language models into any application. Through its security and governance controls, Kong AI Gateway allows businesses to carefully control the flow of data to any AI model or application, and effectively manage consumption.

Due to its complexity, the growth of AI technology will depend on the proliferation of APIs. Simply put, you need dozens of APIs to do AI well, which is why Kong and his backers think it has such a bright future ahead of it. he.

Marco Palladino, co-founder and CTO of Kong, spoke with John Furrier, executive analyst at theCUBE Research, at a conference Conversation in September, when he explained how API management has become essential to scaling AI workloads. He explained that the large amounts of data consumed by AI applications mean the need for advanced systems to manage and optimize API traffic has never been greater.

“It’s very important to actually understand what AI traffic is doing,” Palladino said. “If we understand semantically what is being asked via AI, and therefore understand the meaning of the prompts, we can then understand how similar the different prompts are to each other. Now we can implement intelligent capabilities to accelerate, secure, route, and more this AI traffic.

Holger Mueller of Constellation Research Inc. said Kong’s ability to raise so much money underscores the need for companies to be able to help connect much-needed data to and from AI systems using APIs. “Kong’s capabilities are critical to powering the next wave of generative AI, which will need to examine transaction data in real-time to support better automation,” he said.

Over the years, Kong has accumulated a strong customer base of more than 700 companies worldwide, including well-known companies such as GSK plc., PayPal Holdings Inc., Moderna Inc. and the New York Stock Exchange, l helping to increase its annual turnover. recurring revenue of over $100 million starting in December 2023.

Kong said the funds in today’s round will help it stay at the forefront of the API revolution, and that it plans to accelerate its global go-to-market expansion strategy, to invest in product innovation and strengthen its engineering and customer experience teams.

Image: SiliconANGLE/Freepik AI