The a16z Show - How Kong Was Born: APIs, Hustle, and the Future of AI Infrastructure

Episode Date: October 21, 2025

Augusto Marietti, CEO and cofounder of Kong, has one of the most remarkable founder stories in Silicon Valley history.In this conversation with Martin Casado, Aghi shares how he went from a garage in Milan to building one of the world’s leading API infrastructure companies, surviving years of rejection, living in the U.S. on $1,000 a month, and raising his first $50K while sleeping on Travis Kalanick’s couch. They talk about the near-death moments that defined Kong’s journey, the seven-year grind before breakout success, and how APIs became the “assembly line of software.” Aghi also explains how Kong evolved into the backbone of modern API and AI connectivity, and why the coming wave of AI agents will make APIs more essential than ever. Resources:Follow Aghi on X: x.com/sonicaghiFollow Kong on X: https://x.com/kongFollow Martin on X: x.com/martin_casado Stay Updated: If you enjoyed this episode, be sure to like, subscribe, and share with your friends!Find a16z on X: https://x.com/a16zFind a16z on LinkedIn: https://www.linkedin.com/company/a16zListen to the a16z Podcast on Spotify: https://open.spotify.com/show/5bC65RDvs3oxnLyqqvkUYXListen to the a16z Podcast on Apple Podcasts: https://podcasts.apple.com/us/podcast/a16z-podcast/id842818711Follow our host: https://x.com/eriktorenbergPlease note that the content here is for informational purposes only; should NOT be taken as legal, business, tax, or investment advice or be used to evaluate any investment or security; and is not directed at any investors or potential investors in any a16z fund. a16z and its affiliates may maintain investments in the companies discussed. For more details please see a16z.com/disclosures. Stay Updated:Find a16z on YouTube: YouTubeFind a16z on XFind a16z on LinkedInListen to the a16z Show on SpotifyListen to the a16z Show on Apple PodcastsFollow our host: https://twitter.com/eriktorenberg Please note that the content here is for informational purposes only; should NOT be taken as legal, business, tax, or investment advice or be used to evaluate any investment or security; and is not directed at any investors or potential investors in any a16z fund. a16z and its affiliates may maintain investments in the companies discussed. For more details please see a16z.com/disclosures. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

He opens a closet and there's like all the bananas falling off because one guy is only eating huge bananas. He opened another closet. There's another mattress with other guys leaving a second closet. Say, okay, this is real. We had no money. We just take 600 bucks last left to go to United Flight. And we had 90 days to just make it or break it. We knew that if we couldn't race, we wouldn't go back to Italy, broke and that was it.

I think a lot of people don't know or maybe don't appreciate how fast Kong grew, it actually happened. So there was seven years of starvation, right? I mean, it was just basically wasn't working. Every year we do the Founders Award. The Founders Award is 2,555 stock to the best employee of the company. Why that is 255 days of struggle. It's just symbolic.

But to remember seven years of struggle, every year is a retal. What if the backbone of modern software was forged on $1,000 a month in a borrowed couch? Today's guest is Augusto. Aghi Marietti, CEO and co-founder of Kong. He joins A16Z general partner, Martin Casado, to trace an improbable path from a garage in Milan to building more of the world-leading API platforms. We get into the seven-year grind before breakout, the near-death moments that forced reinvention and how APIs became the assembly line of software.

Augie also explains how Kong sits in the flow of everything, from microservices to AI agents, and why the next wave of autonomous systems will make APIs more essential. than ever. Let's get into it. So, Agi is the founder and CEO of Kong, which was previously MASHApe, and we're covering his background from a garage in Milan to now being the CEO of a at-scale company with, I dare say, IPO ambitions at some point? Long way. Well, I'm a long way to go, but that's one of the steps along the way. Ambitions. All right, so you're doing this kind of API thing. You come to the U.S. on a tourist visa?

Tourist visa, yeah. And the idea was to raise... 90 days. Is the idea to raise funding? Yeah, we had no money. We just take 600 bucks last left to go to a United Flight through Cincinnati. We went through secondary room.

And we landed up, sorry, Atlanta first time. Cincinnati was second secondary room. And then we went, we were right to San Francisco, and we had 90 days to just make it or break it. We knew that if we couldn't race, so we would have go back to Italy broke and that was it. So did you raise them? Yeah, we raised two weeks before departure.

You raised in those. Inger rounds. We're talking about that kind of go, right? Small checks. It was 50K. Angel round. Who was it from? It was the founding YouTube teams.

Oh, really? There we go. And here's the funny story. How did you get introduced to that? There's two interesting thing that you say, can you redo it again? I won't be able to redo it again. Yeah. So number one is we went to the Stanford Entrepreneurship Week.

At that time, Stanford was doing the Stanford Entrepreneurship Week in February. And it was cool. You made all the entrepreneurs, all the VC were coming there. And there was this interpreciate mixer, big party. We arrived. We left late. At that point, it was old paper. with all the email and the registration,

we steal the things with all the email and the registration. And we walk home with that. And then night till 5 a.m., I writes all the 400 emails about, hey, you need to know about Michelle. We didn't have time to catch up at the mixer, but I'm happy to give you a pitch tomorrow. Wow. I think 470 didn't reply, 30 reply,

and 10 were kind of interested. And at the end, 5 or 6 went to meet us. And then this one person, like Kevin Donnell, who was one of the founding team, of YouTube, came to our... What's his name? Kevin Donahou.

Kevin. And then he started a company for baby books. He sold it. But he said, look, I think this is something... So he wrote a $17,000 check on an earmatch. 17,000? Yeah. And for us, 17,000 was life.

Yeah. First was dead. Yeah. Because we came from 600 bucks and a few hundred bucks. And so then he brought two other funding Tidder. Actually, it was 16,000, 16,000, 16,000, we got 15,000. They're probably 15,000 divided three. It was 6, 6, 6, 6, 6, 6.

It was too many 6. It's like, we don't want too many 6 in the captives. So we rounded up 17, 17, 17, and we got 51,000 check. Now, the second funny part is we negotiated and closed the deal at Travis Kalanick House. Travis Kalanick's house. I remember there was an article about you sleeping on his couch. Yes, and Airbnb guys as well. But what happened during the negotiation with these guys were negotiating and they didn't want.

So Travis at that time was this house up in Castro called it a jam pad where everybody goes. Aaron Lee would go. And Drew from Dropball was the data. We're all going there on the weekends. I didn't have a place to say. So actually, Travis gave me his place to stay a few weeks, as long as I would cook Carbonara for his better half once a week. And I did that.

And then we need a help and say, come to my kitchen. We negotiated it. So we sit on the table. It was myself and Travis Kalanik. And they were the three YouTube investors negotiated these convertible notes are like 50% discount, something crazy. We were desperate. And so I said, okay, well, I don't want to take this deal.

Screw that. And say, okay, we're going to leave. And I was very naive, 20 years old. Okay, okay, give a comeback. And Travis come to me. put the hands and say, if this guy leave, you're never going to see them again and nor the money. Wow. So let me do something else.

So you guys stay here and figure it out the counteroffer. Agi and I go to the bathroom. We close his salary and we come back in 10 minutes. So Travis brought me to the bathroom, locked the door of the house so these guys don't leave. Went to the bathroom and we said there 10 minutes. Go back. Another round of negotiation. Back to the bathroom.

So three, four time. At the end, we handshake on the deal. And what was it? Finally better, like 42% convertible. It's kind of set of 50. It was a higher cap. And that's it. And then we shake the hand and that was it.

That's crazy. So I remember you had the Quora, like the top Quora post for living on like 14,000 a year in San Francisco. You'd raised 51,000. And now you had to make that last as long as possible. So maybe talk about the next stretch. What happened is obviously we got 50, we've got to come back. We are illegal. in two weeks. So we went back to Italy and we came back with a B1, which you could be there.

We can be here six months. But how we have no social security number? We have no credit score. Nobody. So you have into this American system very different than Italy system. You have to enter into a new system. And we had zero anything. So we couldn't pay our salary because we didn't have SSN. We didn't have a legal visa to pay ourselves, all that. So the company. Did you have employees at this point? No. It's just you two. It was three of us. It was Michele was the our co-founder back then. But we did about 1,900 monthly promissory note that the company would give us and we would have to live in three with $1,000 a month. So you were living off $1,000 a month? In three. Three people were living off $1,000 in San Francisco. How do you

do that? It was cheaper. No, what year was this? 2009, 2010. Even then, it's as impossible, $1,000 a month for three people? I tell you how we did it. So we live it in on Airbnb. be somewhere else at a hundred bucks and all in the same mattress. And we were going to Valencia. I don't know if you did some Valencia. Did you have an office? No, we were working out of Starbucks. And we were living in Valencia and we were buying rice, beans and tuna and pasta.

And the reason is that we had to find the right amount of carbs and product the cheapest way possible. And that was the combination of, I guess, amount of carbs and product at the cheap. the way possible. And that's how we made it. Like, we never eat out. We never buy it. We did everything in the house. We cooked in the kitchen Airbnb, rice, beans or tuna pasta. In fact, we'd so much tuna pasta with tomato that Marco and I, when we see now tuna pasta, we almost threw up because we're just running on tuna pasta every single day. So how, wait, so how long did this last?

That last. So March, April, 2010, a year, a year and a few months. And what were you doing this time? I can, I know what Marco was doing this time. He's writing code. What were you doing? I was writing blog building the website, calling the sign-up, talking with every sign-up on the website that was talking to us and tried for hours. I was doing big of B-defs, HTML, CSS slicer, talking with investor to us, you start to build the seed rounds. Yeah.

Trying to do some recruiting that never worked because nobody wanted to work for illegal Italians that will disappear. So a lot of mistakes and this, yeah, figure things out. All right. So take us to the seed rounds. So somebody decided to give you a proper round at some point. So then a year later, we re-architects. So we went to on Olu, on the beach, Moana Beach.

We thought about, okay, all these APIs were aggregating. I think the word is actually we see now, finally now. But 10, 15 years ago, it wasn't ready. They were to build apps on the flight through APIs with drag and drop. We were too far ahead. We're missing pieces. But I say, hey, we aren't wrapping a lot of APIs. Actually, that assembly line visual still whole.

We just have to pivot it and build an API marketplace where all the APIs producer and consumers, they can come together. And so we peop of that, we relaunch it, we did it, then crunch, all the stuff. Okay, so originally we're doing this kind of drag-and-drop composable. Apps builder. It's so funny how many companies go through this exact journey.

And then you're like, okay. With HTML 5. Wow. And then you're like, okay, no, we need to build a marketplace. Exactly. Because, okay, the economy, this API economy will come. It's not just apps. It will be APIs.

And we build a marketplace. We launch it. got disinteractions on long tail. And that was already the summer of 2011. After a pivoting in Hawaii. So we launched very fast, boom, boom. And then we race after. Was the Hawaii on the last of the money from?

No, no, because San Francisco to Honolulu, I think at that time, it was like 300 bucks. So I said with our 51K, you know, we're living like on tuna, pasta, rice and beans, in Valencia, in Mission, in this historic building, middle, northern, and you guys, and like, same mattress and things. It's like, unbelievable. At some point, I remember.

I didn't know that. I remember a couple of morning, I need to go to On O'Lulu. We could do our walk on the beach and thinking about our future or no future, because we knew this was going no future. Our money were starting to drain and we needed to pivot. And that's where we had the idea, let's go for the pivot. And then we come back, we did the crazy. I remember building the Webster, St. Mark was crazy.

The third co-founder was building all the Java backhands and the launch at fast. And I've got a little bit of TechCrunch press. At that time was read, right web. This is either what was mashable. And so somehow we got cold. by all of them, which is now like, Chris. And then, and boom, and then start the seed round phase. From who?

So at that time, we went through a lot of iterations, but where we ended up was NEA leading the seed round and then index co leading to NEA. And then we got a bunch in the C. So Volpe did the. Yeah. So what happened is actually the first checks for George Zachari from CRV back then. He didn't lead the round, but it was the first 100 K commit. So with that, he said we have CRV, 100K at that point at a seed program.

very unusual back then. So we went 28. And he said, we're going to lead this round. At that point, so they started a seed program, 500K. And then I met Mike Volpe that just moved to San Francisco to Lange Index, US.

It was like him and Danny Rymer showed there somewhere. And they also started an angel, a seed program, and they wrote out other big checks. And then we got a long tail, which was likely Jeff Bezos and Eric Schmidt into the funds.

And so we got this combination. How did you get Bezos and Eric Schmidt? So again, this is a sitting in DPD that, I don't know, we can't. So what happened is Jeff Bezos. So Jeff Bezos, I knew he was special about marketplace as a business, APIs and developers.

AWS was just starting to take off. It was this hidden secret. So 2011? Yeah. So Alonso was maybe a $50 billion company than a $80 billion company. So what happened is I hired the lawyer of his family office for Kahn, for Meshade. And after we, we hired for doing the Cid round as the Cidron was going along and say, by the way, since you are

also the lawyer of the family office and Basos expeditions, can you introduce me? Can introduce me to Jeff Bezos? That's what we do. So it's a PG-C-call. And then he was on the road with his brother, going around with his brother on the road in Texas. And you actually want to put more and invest. Boom. So that was Jeff Bezos. What do you get from Joe Bezos? You get the brands. We got a diner's a year strategy giant of things. But obviously it was the big brand. And then second, Eric Schmidt, we were working in this co-working space. And what happened is we were the only startup that stayed the latest in the night after

this other startup that was doing Expedia for cruise ships. They just raised from NEA and Eric Schmidt. And at the end, they saw us work until 3 AM, 4 a.m. They will leave a chew. When they knew we're fundraising and the investors asked who is the artist who's the artist worker, they knew, and say, these guys next to us. And so they introduced us to the Eric Schmidt Fund and that's how Eric Schmidt invest. Wow. Totally unrelated.

All right. So now this brings us a lot of luck. So what was your total? What was the total seat funding raised? At that time was very big. It was 1.5. It's like, wow, huge Cedra. I got to say. In 2010, 11. I got to say there's a lot of optimism. It's an optimistic retrospective view to be like there was three of you on a mattress for a year and then you say you were lucky. Illegal.

That sounds pretty unlucky to me. No longer to jail. All right. So now you have your seat on mass shapes going. So then we raised the seat. All right. Now it's real. We've got to get these visas.

We got to middle. So we went back to Italy, go to the American embassy, blah, blah, blah. Do their letter of recommendations. Actually, Sam Altman was one of the guys that wrote me a letter recommendation when he was CEO of Looped. Oh, kidding. Which I met. We were going to the N.E.A. retreat.

And I see next to him in the bus. And we went to Pebble Beach. to the annual retreat and we spent three hours together. And I said, by the way, I'm illegal here. Can you write me a letter of recommendation for my 01 visa? Oh, kidding. And you wrote me.

So I have this big thing of how great I am. From some other than I was great. From some other condition. You gotta get this guy in the country and no matter what. So we got these five letters and I get this O1 visa and Farr got the visa. So if I can come here, I can get a wee work space

and we start to hire and we got seven people and Mark also get the visa. Markov is also because of the love book. He never got to college or nothing. So it was the hardest visa to do. So we figured it out more letter recommendations for him. We brought him there. We stay here, blah, blah, blah.

We build that year. We grow down. But at that time, like you needed like a million, let's say a million revenue to take a good CIRSA. For a marketplace, you need a million in gross volume. We were like at 50K. So a lot of traction, but not a lot of revenue. But we went through a three, four months CIRC raise. and CRV lead and then indexed.

Was it Dev. Yeah. Yeah. Yeah, because George Zachary was more a consumer, so he passed the thing to Deftat just John, more on the enterprise side. I remember Deftal Colby, like, Sunday at 6 a.m. to go for a walk,

to decide to invest or not. And he knows I'm a night hall. And he just Sunday 6 a.m. to go down to Palo Alto, which I had to rent a zip card. There was no Uber. and go down there and then go for a few walks and I decided to invest. Because it was always actually a big believer on APIs as assembly line. He could see that.

Maybe it wasn't sure marketplace was the right execution, but the theme, he was a big believer. And I think he like us, like he came to see us sleep in the same mattress. He wanted to really see that we're not like bullshitting the big drama story. It was really drama. Actually, he opens, he came to the Hacker House because we moved to Hacker House in South Park back at that time, where we're sleeping and working there with the 70p. And he opens a closet. and there's like all the bananas

falling off because one guy is all eating huge bananas. He opened another closet there's another mattress with other guy sleeping in a second closet. It's okay. This is real. Wow. How big was your A? 6.5 million. Oh, so for you that must be, must have been

a lot of money. 6.5 million. Yeah, I went out with this power part. Let's raise a 10 million seriously. At that point, I was like the big thing. We ended up at 6.5 and I say that science, it was like, when we saw it, it was like, yeah. And like, maybe we got a shot. So at some point you decided that the market wasn't working.

The market wasn't working. And I think, so we raised this and we hire more. We moved to a new office, 25 people. Like, you know, the usual post race honeymoon. And I remember this thing, like six months after, the business wasn't really doing anything. So it was one board mini that we just cooked pasta for the board members at that time because it was like two years before you join us.

And it was nothing to talk about from business. The issue was you couldn't monetize or there was a term, there's a graduation problem. These marketplaces are very tough. So the idea of the marketplace when I was staying with Airbnb funders, I learned that the microplace could be the biggest more powerful business in the world. You don't even have to innovate once you get liquidity. It's just you can disrupt. Look at eBay.

You can't kill it. So I thought like, there's all this API. You can build a marketplace equity. It'll be like the AWS. And so we noticed, though, that in our case, it was a developer API marketplace. So to have to a marketplace to work, you need to have a long tail of low power people. If you have concentrated in a few high power, marketplace doesn't work. Like Airbnb houses, like millions of people with low power.

So that was one. True, you need to have exclusivity somewhat, like the door to access that marketplace. supply has to be through the marketplace. APIs, you could Google and go through the website. You wouldn't go through the marketplace. APIs at that time, power of law for public APIs was on the tweet or the stride or 30 that matters and 3,000 that didn't matter much. So it was also this long tail power.

And 13 is was quality. Like you couldn't, you were running a cloud marketplace. You couldn't actually maintain the quality of the supply. You would always get blamed for it. And there was no trust. And so I think because of that, he got to a million and a half in gross revenue. But he never became this Airbnb or Uber. What was in that?

That is like 10%. Yeah. It was also losing margin in AWS. So I could never make the economics in that model. I could never make the economics works, even if this thing would have scaled. So then we go there. It's like, okay, this is where we're here, we're burning out of money. And so we build this massive API engine behind the marketplace, API Gateway that was

firing 20,000 APIs of this long tail, doing billing, rail limiting, routing, caching, authentication, authorization, logging, all of that. We build it three times and the third time was the great one. And we say, every company will become an API company. Why we don't take this engine and we give it to the whole world? And that was the beginning of open source, Mongo. And so boom, we open source Kong. What was your runway at the time that you open sourced Kong?

So we open source in April 15. We had to take a bridge of two million to go another year. Was it an insider bridge? Yeah, we had to take an extension because we were out of gas. From Deptod and Mike? Yeah, they give us an extension on the A, two millions, because we're out of gas. Like we would have died otherwise. Wow.

So you released, I remember when Kong released. It was actually a really big deal. When was that? 2015. 15. Yeah, that was a really big deal. I remember. Yeah.

So this is when you and I started talking about your raise. You're raising the B. You came at the right time. Before, like, this guys make no sense. Okay, now it starts to make sense. Well, that was even a tough raise for you just because the company had been around for seven years. Like a marketplace.

Like Kong had just come out. And it was taking off, but like, it only been a couple of weeks, maybe a couple of months. And so honestly, I'll tell you what, what did it for me is, you know, we were doing all the work.

And like, the GitHub stars checked out. Your story is phenomenal. Your command of the business is great. But it just wasn't enough. But then, while we were doing the diligence, like I kept getting these

kind of serendipitous, like, somebody had used Kong and loved it. I remember, didn't like somebody stay in like your Airbnb and like loved Kong and like, and then you forwarded that to me. And so they're just kind of like all of this science, you know, zeitgeist around Kong.

And as a result of that, I'm like, oh, this is clearly a phenomenon. Yeah, I remember it was spamming you with emails of every prospect of customer usually they were saying. You're just saying, Kong, Kong usage, Kong usage, just know, stop. It was blowing up the inbox.

Yeah, yeah, yeah. So how close we'd run out of money for the B? So after a breach, there were a, weeks. Yeah, but I was very... Nothing is ever going to stress you again in your entire life because you've been so close to at least business so many times.

Because I actually remember when we went to the office, it felt dead. I felt like basically... No, no, we were dead. We just didn't know about it. You were like two weeks from being dead. We were like Bangalbee, you know, that it flies, but it's not supposed to fly.

We keep going. No, I remember that very, very well. Yeah, you were like, you're like, guys been there, wow, I think they're gonna, you know, whatever, they're raised more, and then they're gonna give up. You were, I said, and it was tough. And I think if we go back and say, I don't know we were able to replicate all the sequence that happens,

all the things that happens. And then I remember we went to, yeah, and then we had that, that great sushi with Mark and Driesa and you and I and we still the deal and Marco. The end of 2016 we closed and since then the company has just been remarkable. I mean, there was kind of announcement recently that across 100 million, which is now actually quite a while back. A year and a half ago, yeah.

A year and a half ago. Yeah. Yeah, it was in a year and a half is 10 years where we were like, when you invested, we were ARR less than a million. Yeah, yeah. Less than a million of ARR. Do you remember? Not even a million at R.

500K probably. Do you remember once? I remember so, yeah, so you had a great first year. And then I told you, I said, listen, if you, if you hit 10 million or whatever it was, I'll buy you a car. Remember that? And I did. Oh, actually, we have in the new office now. I need to send you a picture. Well, it's a funny story about this.

And so, like, you know, you do it. So, like, I think you grow like 10x that year. So that year we went from two million of ERR to 10. That was right. And the planeting was six or seven. Yeah, yeah, yeah, yeah. And then I went to text with compliance and I'm like, can I buy

Augie a cheap car? And they said, the maximum for a gift is whatever it is. So I'm like crap. So I ended up buying you the best model car I could find. From Japan, I think. Yeah, yeah, yeah. I spent a long time actually looking for this model car.

Is there a 280 GT? Yeah, yeah, that's right. So great. So I would love to shift. So I think this is the most remarkable Silicon Valley startup story that I know of that I'm close to. and I kind of having one

that will make a movie one day they will have to make a movie one day yeah I would love to like kind of shift towards how you think about product how you think about markets and then kind of move towards AI so you actually have seen a number of shifts now right you've saw the cloud come you saw the shift to APIs

so maybe just talk a little bit about how you view this current shift with AI is it is it fundamentally different is the same does it change how you think about yourself as a leader like how is your view at a high level? So the big thing is I start with API first. So obviously we become this API infrastructure company.

Maybe maybe we should just describe what Kong is right now before we actually do that. So we left with this pivot and we open source Kong API gateway took off and we become an enterprise company. We became weird brand Kong Inc. And we start to build all sort of API infrastructure to run, manage and secure your internal or external APIs. So you have software, you have microservices, you have 10, 100,000 of APIs. We're kind of these highways that makes them run, and you have rate limiting.

If APIs were cars, you got guardrails, speed bomb, speed cameras, gas stations, stalls, bombs, guardrails, everything, ambulance, and we provide all the infrastructure to make sure that API connectivity runs. For small company, big company, all of that. Now, in this transition you mentioned, what really drove, I think, this explosion of cloud APIs was the workload moving from on-prem through the cloud. The second transition is breaking down the monolith to microservices.

It creates more and more APIs, the big data and all that. It creates events streaming, all that. So this just data in motion is much higher than, it's becoming much higher than like data rest or data news than before. But in a way, when you were starting the company, you were drafting on a big transition, right, which was the breaking down to the monolith and the shift to cloud. Right. That was the key. Yeah.

I think before the world is our archive legacy solutions in APIs, but they were not built for the transition to the cloud and breaking down the monoliths into microservices and high-scale decentralized architecture. I mean, you know from your time and it's here, like we can't invent the control plane, data plane separation at the API management, API control plane level. Nobody was doing it before. I got to say, I think a lot of people don't know or maybe don't appreciate how Fasts, Kong, grew what had actually happened. So there was seven years of starvation, right? I mean, it was basically wasn't working. No.

Actually, you know, and you don't know this, but like every year we do the funders award. Yeah. The founders award is 2,555 stock to the best employee of the company. Yeah. Why that is 255 days of struggle. No, I'm kidding.

Which is seven years. That's amazing. It's seven years. I didn't know that. Every year the company has to go, they get 2055. But it's just symbolic. Yeah, yeah, of course.

To remember seven years of struggle, every year is a ritual. And there was this crazy diving catch, which, you know, Marco does the greatest Kong. He throws it out on the market and it catches off. But once it did, the company grew incredibly quickly. And we had 45 competitors when we started. I remember that, yeah. Now it's probably 30. But even then at the time, yeah, well, Kong broke away pretty quickly.

So, I mean, you know, in recent years, it's just clearly been the leader on this. And that only happens, I think, if there's just clearly a market need. The market also kind of did you a favor in that, like, Mulsoft got acquired and Apogee got acquired too. Yeah. Right. It was right. Yeah, 17. Yeah, 17.

ApiG got acquired in 16. That's right. Yeah. So, like, in a way, kind of like, there was consolidation, and you broke out the business later. So you kind of navigated this transition from, you know, cloud to break up the microservices. You know, you built the control plane for APIs.

You're considered now, like, the, you know, the leader independent for sure in the API space. Kong is the leader independent. There's no question of that. But now you're facing another market shift, which is kind of this movement to AI. And so do you view this as directly impactful, adjacent to creative? Like, how are you as CEO viewing this?

Yeah. I think, again, it's not like what's like any meat of things, but the market came at us in AI by creating more APIs. What that means? Agents are going to consume internet, in a very different way than how it's human did. There's not any more websites, scroll, click, up and down, applications. They're going to be there, but not as relevant as before.

Agent is going to programmatically exchange labor, get tests down through programming interface, whether it's classic IPRS, MCP protocols, which is like Duolingo for APIs, makes them speak English, whatever it is the protocol. But machines consuming internet is going to be very different than human consuming internet. Human consuming internet would be through UI. Machine-consuming internet is through programming interface. That's a huge shift that we are now capturing and paring and making sure the enterprise think about AI connectivity.

And at the end of the day, behind the scene, it's all APIs. We had that board meeting, what was it, yesterday? Yes. And what I found actually pretty remarkable is how many more banal use cases there are around AI, right? We can talk about agents, And I think it's worth talking about and I agree with you. But it also feels like there's like a lot of just basic stuff.

Like key management for, you know, like a lot of companies are spending a lot of money on these AI models. Right. So it's great to be able to have like, you know, monitoring, billing, key rotations, all of that stuff. So are you actually seeing like a non-agentic draft now? Yeah. So when I think the word is a bit of stack, okay, you have these AI companies like poor that are just, just building models, yada, yada. And then you have this wrapper company that are trying to solve, you know,

HR issue, whatever through AI. Then you have these LLMs that have APIs to talks, companies like Anthropi, a lot of revenue through APIs, all that. What is missing is the infrastructure to make those AI talks and run. And that's what we do now. We digate to a lot of products. But at the core, the boarding problem, like you mentioned, authentication, authorization, authorization.

You can be AGI as much as you want, But at the end, an agent gets stuck if it has to authenticate. And to authenticate, you've got to get an API key. You need a human in the loop to get the API key authenticate. But if you can provide infrastructure at the beginning, you can provision and automate key provisioning, key rotation, authentication. So once you're there, you can unleash your LLM, your agents to just roam free without getting stuck every time for authentication authorization, because you're already provisioning all these keys. I think that's where we want to our customers. So maybe just assume for this part of our discussion that whoever's listening is pretty familiar with API infrastructure, right?

Do you think that the way API infrastructure looks in six months or a year or two years is dramatically different because of AI? Or is it that the infrastructure that we have in place that we understand today evolves to also service agents in ways that are pretty obvious? Like, to what extent do you think this is like transformational on the infrastructure layer versus like more of a transition? I think you cannot do AI if you're not API first. It's just you don't have the amount in the years to a model. And so that's how AI talks. So the way we know about API infrastructure, it will evolve and won't change. But API traffic and AI traffic, they're converging.

So the classic API calls, yes, but also when you move talk, is an API call. And intelligent, let's say intelligence will be sold through tokens. Every earning release is about tokens. But behind and each tokens, there are calls that payloads move tokens. So they're kind of converging. And what we are calling our building is a unified API and AI connectivity platform that helps you navigate this transition.

As you're managing classic API traffic, as you're managing agent traffic, as you manage MCP traffic, as you manage LLM traffic. I think it will all converge into a unified like, And that's how I think intelligence will move and it was an evolutionary steps in like two, three years. But we really see MCP traffic growing every quarter. I mean, I see even like really basic things like for developers. This is evolving very quickly. So for example, you know, for fun, I develop using cursor.

You know, I used to be a professional developer, you know, in a previous life. Even knowing what APIs existed in a company required a ton of redeploying. required a ton of reading through docs or some weird search. And it feels like now, especially like if you have something like Kong, which has all the metadata and has the catalog, and then you can integrate into something like cursor. So not only does the agent itself know about the APIs, but you can not expose it to you.

I mean, it feels like a lot of like even the development paradigm is shifting now because we can start surface these things to developers. Yeah, I think you can, you can be an enabler. helps large companies, small companies to get into the hands of more developers or more course for, because it's also our API. We can provide you that infrastructure and all of that. As you see from yesterday, Burma, we have a very exciting roadmap that is going in all in that direction.

So those are already in them. I think here's the big bet. The big bet is what happened in Microsoft, because I grew up in Italy and you don't really study a lot of math. You just study history. But what you learn from is that even it doesn't exactly repeat, but it reads. It's just as always out now. So what we see with microservices, what happened?

We first build rail limiting and authentication 10 times, 100 times, 50 times into the Python framework, the JavaScript frame or the JavaScript frame or the Java frame, whatever, PHP, blah, blah, at some point, it didn't make any sense. Let's subtract everything to a gateway pattern. And we move all this connectivity logic to the gateway and that dispatch to the right service, no matter what language. The same thing I think is going to happen in LLMs. At first, you have one enterprise.

use one big LLMs. Now they're going to use 5, 10, 100, small LAM, medium, large, whatever. Once you get to, you don't do tokens relimiting, token authentication in each LLM using the frame or the Lange chain, whatever. Eventually, same thing happening in Microsoft. You will abstract that to a gateway partner once again. And that's where I think I get to it will have the same analogy and dispatcher to write connectivity logic to the Rite LLM versus rewriting initial LAM. I think that's the big bet that we make that happens in microservices, happens in how enterprise will run and govern hundreds of LLMs.

Great. Well, listen, as we wrap this up, I think it would be great to kind of end with like any sort of recommendations for people that are listening to learn a bit more about how kind of AI shifting the API landscape or maybe, you know, some advice on... Don't start a company. Yeah. Maybe advice on kind of like, you know, how to start thinking about getting ready for that.

I think I said before, like there is a lot of focus on model pre-training, tuning, all of that. But a key thing is the connectivity layer, how LLMs, agents, whatever, will talk to each other, how you will run. I think a lot of the traffic will be very strategic and yet to build the startups of the enterprise to manage that AI connectivity into your next apps, your next internal tools, your next customers. And for the, listen, the budding founders that are listening to, like, the most hardcore Silicon Valley struggle story ever, what advice do you give to them? I think, what I learned over a decade of life. Do you ever think, I just have to, do you ever think that, like, maybe you should have cut

your losses and try to start it over again? Like, do you ever think that that would have been the right thing? Never. No. Never. Never. The reason is I could never visualize myself going back to the airport in Italy. And my dad picking him up and say, how's it going?

And it's just like would fail with my tails and my legs. Like, I could never, I would have died here without food. Like, I cannot do that. And so that never crossed through the heads. Shivers. That was so good. But never. Like, that's the visual that every time I even start to, I had that visual.

And immediately I'm not going back like that. Wow. And so, and then, but the thing to advise is, it always take longer than what we think. It is good to take a trend the last 10 years, 20 years, because you have time to grow into and do a lot of mistakes and building. And just you have to generally believe it in this trend versus falling glitters because it's going to take longer than what you think. As a leader, as a human, as a market, as a product, as a revenue, is always going to

take longer. So take something the last and just put 110% on it every day. and then it will compounds, keep the barn rate low in the early days. Don't die. Don't die. Like, don't quit. Those are, I think, the things I learned along the way. Agi, it's been a privilege and an honor working with you these past few years.

And thanks so much for coming on the podcast. Likewise. Thank you, Martin. Thanks for listening to this episode of the A16D podcast. If you like this episode, be sure to like, comment, subscribe, leave us a rating or review. and share it with your friends and family. For more episodes, go to YouTube, Apple Podcasts, and Spotify. Follow us on X, A16Z, and subscribe to our Substack at A16Z.com.

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