Apigee, an API management company, has acquired InsightsOne for its predictive analytics technology. With InsightsOne, Apigee will have a platform that helps companies find patterns in multiple data sources to, for instance, tell healthcare providers in advance about an unsatisfied customer. Terms of the deal were not disclosed.

Founded three years ago, InsightsOne, has $4.3 million in funding it received in 2012 from NorWest Venture Partners. Prominent investors Gaurav Garg of Sequoia Capital, former Yahoo Chief Technical Officer Zod Nazem, and Alpha Venturi founder Peter Wagner also participated in the funding as noted by VentureBeat at the time. Co-Founder Waqar Hasan will join the Apigee executive team. Before starting InsightsOne, Hasan ran the Yahoo! data platform for five years.

The InsightsOne group has offered predictive analytics for consumer companies. It finds patterns from multiple sources of information. For example, Hasan explained how its analytics might help provide patterns in data from a fitness monitor but also health claim information. With that encompassing profile, a company may provide deeper intelligence insights.

One of the oldest API management companies, Apigee recently shifted to put an emphasis on analytics. Last February, the company introduced Apigee Insights,  which uses apps and data from APIs and other sources to gain context and insight.

In the larger picture, the API is now the way to connect apps and deliver data. This API data can also be aggregated and pooled with other types of information that a company may have in its own databases.

For example, there is the increasing amounts of data that people and machines create. With that scaling in data, there is a growing demand for new types of analytics capabilities. Graph databases are becoming more popular for the varied amounts of data they aggregate and analyze. These graph databases organize nodes, which might be things like a street light or people. The properties of a graph database describe the nodes. A graph database also has “edges” that connect the nodes and properties, defining the relationship between them. The value is derived when analyzing the patterns between the nodes and the properties.

As sensors become more widely used in wearables such as Google Glass, the demand for graph databases will increase. It will be important to correlate the data from the any number of sensors that might be in a house, a car or city street. There will also be the need to analyze increasing amounts of text from medical records, contracts, etc.

It’s the intersection with APIs and the patterns that come from graph databases and text search capabilities that Apigee sees as a long-term opportunity with InsightsOne.

But like any other company in the API analytics space, Google’s deep analytics capabilities loom above Apigee. Add the bevy of analytics providers and the competition looks daunting.

Apigee is a veteran of the API space but there’s a question about what will come of the company with its focus on analytics and its legacy as an API management provider. Its competitors, such as Mashery and Layer 7 have been acquired, leaving it as the largest of the remaining independent API management companies. An acquisition or IPO are the logical outcomes. For an IPO, the question is about its overall growth potential to be an attractive opportunity for investors in the public markets.

(Feature image via Flickr)