As the number of SaaS tools used by businesses has exploded over the last decade (the average organization uses 110+ SaaS apps), integrations have become an essential part of product development. There is now an expectation from buyers that the SaaS products they onboard provide interoperability with the rest of their tools, as category leaders including Salesforce, HubSpot, and Atlassian all provide incredibly integrated product experiences.
This has given rise to numerous SaaS integration platforms, all of whom have tried to solve the problem of the disjointed SaaS ecosystem. At a high level, these are all platforms that enable SaaS applications to be integrated with one another. But the approach in which these platforms approach the problem vary – as a result, the term “SaaS integration platform” can actually refer to a few different types of solutions.
There are 3 main approaches:
- Embedded SaaS integration platforms, also referred to as embedded iPaaS, which are used by engineers and product teams at B2B SaaS companies to provide their customers with native integrations.
- Unified APIs, which are constrained APIs that enable engineering teams to interact with multiple SaaS APIs at once.
- SaaS integration platforms-as-a-service (iPaaS), which are used by internal operations teams to pass data between apps in their tech stack.
In this article, we’ll explore the pros and cons of each solution.
- There are two different approaches that SaaS integration platforms take to solving the integration challenges - equipping the buyers vs. equipping SaaS providers
- Buyers use SaaS integration platforms as a service (iPaaS) such as Zapier to connect applications in their own stack
- SaaS providers can use embedded SaaS integration platforms or unified APIs to accelerate the development of native integrations in their application
- Embedded SaaS integration platforms (embedded iPaaS) platforms offload and abstract away the complexities of managing authentication, defining integration logic, and provide monitoring solutions
- Unified APIs provide a common model that can communicate with multiple 3rd party SaaS APIs with a single request
- SaaS providers can build a connector on a traditional iPaaS to enable customers to build their own automations
#1 Embedded SaaS Integration Platforms (Embedded iPaaS)
Users: Engineering teams at SaaS companies
Problem: Their customers need X integration provided out of the box inside the product, but building these native integrations requires a huge engineering lift.
Embedded iPaaS platforms are the most extensible solution for engineering teams at B2B SaaS companies to build native integrations into their products for their customers. Native integrations refer to integrations that require no set up or maintenance from the end-user’s perspective, similar to the integrations you’d find in the Slack App Directory or HubSpot’s App Marketplace. Generally, configuring these native integrations is as easy as having users enter their credentials into a login screen for the third-party app, and at most, defining how they’d like the data to map between the two applications. Here's an example of a native HubSpot integration that was built by the the TL;DV (transcription SaaS) engineering team with an embedded iPaaS. They've pre-efined the integration logic, so all end-users have to do is authenticate and toggle on/off the features they want.
Embedded iPaaS platforms solve the integration problem by abstracting away the most complex parts of developing native integrations from the ground up for SaaS companies. While not every embedded SaaS integration platform has the same set of features, common capabilities include:
- Fully managed authentication
- Built-in error handling and auto-retry
- White-labeled end-user experience
- Integration logic builder
- Logging and monitoring tools
- Pre-built API abstractions to other apps
- Building both native and bespoke integrations for all/specific users
Certain embedded iPaaS vendors like Paragon are extremely focused on extensibility and the developer experience, which saves SaaS engineering teams from running into limitations with the types of use cases they can build for their customers.
SaaS companies that leverage these embedded iPaaS solutions today are able to significantly reduce the effort and time required to build the integrations their customers need, making it easier to fulfill customer demand which leads to higher win rates and lower churn. You can learn more about how fast growing SaaS companies leverage our embedded iPaaS to scale their products’ integration roadmap here.
#2 SaaS Integration Platforms (iPaaS)
Users: Operations teams, or any software end-user
Problem: The various software applications they use don’t talk to each other, and they need a no-code way of building automations between their tools to pass data back and forth
SaaS integration platforms, commonly referred to as iPaaS (integration platform as a service), are not used to build productized integrations. Rather, these platforms tackle the integration challenge by providing end-users of SaaS platforms the tools to build their own automations between the various apps that they use.
Some of the most well known platforms in this space are Zapier or Workato. In the past, if teams needed to pass data between apps in their tech stack, they would have either had to export and import CSVs of data on a recurring basis, or if possible, try to get an engineer to help them build an internal integration by working with the APIs of the tools they wanted to connect. Both these methods are both resource intensive and inefficient, and at times unfeasible without an abundance of engineering resources dedicated to serve cross-functional teams.
SaaS integration platforms/iPaaS provide no-code/low-code interfaces for operations teams to easily build simple automations/data transfers between multiple applications without having to understand how to work with APIs.
This market exists because the software tools they use don’t provide the necessary integrations natively. And even if they do, oftentimes the native integration doesn’t cover all the use cases that the end user requires.
Partners: Engineering teams at SaaS companies
Problem: Their customers need X integration, but they don’t plan on every building it, yet want to provide their customers a ‘backdoor’ for building their own automations.
Traditional SaaS integration platforms do play a role for SaaS companies as well. Many early stage startups defer building native integrations into their product because of a lack of internal resources, and resort to partnering with traditional SaaS integration platforms.
By listing their application on the iPaaS platform, they can offload the work of integrating onto their customers. In this model, their customers are forced to become users of the iPaaS platform in order to build their own integrations/automations.
You may have seen this within some of the integrations pages of tools that you use, where they will list an ‘integration’ with a SaaS integration platform like Zapier.
However, this approach is generally used as a short term solution to unblock users who require some form of integration capability. Long term, SaaS companies all move towards providing their users native integrations due to benefits including:
- A better end-user experience
- Ability to support complex and deeper use cases
- Creating upsell opportunities
#3 Unified APIs
Users: Engineering teams at SaaS companies
Problem: Different customers need different integrations within the same category of solutions (ie. for CRMs, there is Salesforce, HubSpot, Pipedrive, and for communication, there is Slack and Teams), and engineering teams don’t want to build each one individually.
While a unified API is not a SaaS integration platform on its own, the vendors supplying the unified API always provide a platform alongside the API, which is why they made it onto this list.
A unified API creates a layer of abstraction across a common model across multiple APIs simultaneously. In practice, this means that SaaS companies can build a single integration with the unified API and instantly deploy all the integrations supported by the unified API at once.
This in theory would save engineers significant effort doing research into each 3rd party SaaS application’s API - instead, they would only have to learn the structure of the unified API.
Unfortunately, unified APIs come with many limitations when compared to the other SaaS integration platforms on this list. The more apps in a given vertical that a unified API supports, the fewer endpoints it can abstract.
While there is some value in generic integrations, more often than not, end-users want a deep integration experience that is built specifically for the integration they need. If a SaaS company builds an integration that doesn’t support the deeper use cases that their customers need, their customers may look at alternative solutions that can support their requirements.
When it comes to the platform side, unified integration platforms provide:
- Logging of individual requests
- Managed authentication
- End-user management dashboard
You can learn more about unified APIs here.
Although each type of SaaS integration platform aims to solve the challenges of the disjointed SaaS ecosystem, they do so in very different ways.
Embedded iPaaS platforms are SaaS companies' best choice for building the native integrations their customers need into their product, as it enables them to focus purely on designing the integration logic without worrying about the overhead on infrastructure and maintenance.
Traditional iPaaS platforms enable end-users to set up automations internally when the tools they use aren't natively integrated, and SaaS companies can integrate with these iPaaS solutions to offload the integration effort to their users.
Unified APIs are a class of solutions that SaaS companies can use to build 1:many integrations, but the fact that they have to cater to a lowest common denominator ultimately means that the possible use cases that these unified APIs support are extremely limited.
If you’re a SaaS company and you have integrations in your backlog, book a free demo today and see how our embedded SaaS integration platform can help you accelerate integration development.