Embedded iPaaS: The Scalable Integration Strategy for B2B Software Companies

Learn all about embedded iPaaS: what it is, benefits, and how to choose the best solution for your team.

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Introduction

Integrations have become an essential part of the value proposition for B2B software products. More than ever before, business customers expect that any new software they purchase will provide seamless, out-of-the-box connectivity to the rest of their tech stack.

As a result, today’s software companies find themselves faced with the challenge of delivering dozens – sometimes hundreds – of integrations connecting their own product to the other apps and services their customers use. In most markets, these integrations are simply table stakes for getting a competitive product to market, winning deals, and retaining customers.

This leads to some critical questions for product leaders: How do you quickly deliver the integrations your prospects and customers require? How do you efficiently maintain and support them? As your customer base and their integration demands grow, how do you accomplish all of this at scale – without consuming too many engineering resources and getting distracted from your core product?

We’ve compiled this guide as a resource for B2B SaaS teams seeking a proven, scalable strategy for providing product integrations to their customers. In this paper, we’ll outline the integration opportunities and challenges facing software companies today and explore why teams are increasingly turning to embedded iPaaS to address them.

What is an embedded iPaaS?

An embedded integration platform, or embedded iPaaS, is a set of tools that enables software companies to build reusable, configurable integrations quickly and deliver them to their customers as a seamless part of their application.

They’re called embedded iPaaS solutions because they include an integration marketplace that software teams can white-label and embed in their product to create a self-activated, in-app integration experience for their end users. (For this reason, you might also see this type of solution referred to as a white-label iPaaS.)

Embedded iPaaS solutions are end-to-end platforms that provide everything a software company needs to build productized integrations, deploy them to customers or enable self-activation, run them in production, and provide high-quality integration support.

A comprehensive embedded iPaaS includes:

A low-code integration designer that empowers non-developers to build productized integration workflows that can be configured and deployed to multiple customers.

A library of built-in components that reduces the effort of building integrations by providing connectivity to many common SaaS apps, as well as common integration logic functions, without the need to write code.

An integration marketplace that teams can white-label and embed in their product to provide a self-activated, in-app integration experience for end users.

Integration deployment and support tools that enable customer-facing teams to configure, deploy, monitor, and troubleshoot customers’ integrations without engineering involvement.

A cloud infrastructure that runs integrations and provides handling for concerns such as scalability, security, and compliance.

What does iPaaS stand for, and what is traditional iPaaS?

To better understand embedded iPaaS, it is helpful to have some context regarding traditional iPaaS solutions.

The term iPaaS stands for Integration Platform as a Service. The majority of iPaaS solutions available today are what we’ll refer to as traditional iPaaS: integration platforms designed to help companies connect the SaaS applications that make up their tech stack and automate their internal business processes.

There are many traditional iPaaS solutions on the market, and well-known platforms such as MuleSoft, Boomi, and even Zapier fall into this category.

The key thing to remember about traditional iPaaS solutions is that they’re general-purpose platforms used by businesses to create integrations for internal use, while embedded iPaaS solutions are purpose-built platforms used by software companies to create native product integrations for their customers.

Who is embedded iPaaS for?

Embedded iPaaS solutions can be successfully implemented by any B2B software company looking to build out a strong capability for delivering customer integrations.

They are used by software companies ranging from startups to scaleups and enterprises, by both SaaS companies and legacy or on-premise software providers, and by companies in just about every horizontal and vertical software market.

Why are integrations so important for B2B software companies?

As we noted earlier, integrations are table stakes in many markets – a non-negotiable requirement for building a viable product, closing sales, successfully onboarding new customers, and retaining them over time.

Several major trends are driving business customers’ growing expectations for more and better integrations, making effective integration delivery an increasingly important part of product strategy for B2B software companies.

The proliferation and specialization of SaaS had made connectivity essential. As companies use more and more apps to run their businesses, it’s increasingly important to buyers that each app not only serves its own core function, but also fits smoothly into the company’s larger tech ecosystem. Today’s business customers simply expect that any new software they purchase will connect easily to the other apps they use.

The pace of automation is accelerating. Businesses are increasingly automating processes and workflows to cut costs and boost productivity, and this has led to even greater demand for integrations.

Integration expectations have come down-market in recent years. Smaller companies are expecting integrations the way only larger companies used to, but don’t have the IT resource to build those integrations themselves. This further contributes to growing integration expectations for software companies that serve small businesses.

Business users are expecting less IT involvement with their apps. Users increasingly expect that they’ll be able to set up and operate their applications without relying on IT assistance, and this extends to integrations. Today’s users demand integrations that are extremely easy to configure and activate.

How can you use integrations as a strategic advantage?

Beyond simply building the integrations that prospects and customers demand, product leaders who build a strong integration capability can use it as a competitive advantage.

By using integrations strategically, you can:

✓ Increase product value. Integrations can significantly extend your product’s capabilities, sometimes in outsized ways. For example, a project-tracking app that integrates with its users’ calendars and messaging systems provides significantly more value to its users than one that does not. Strategic integrations allow you to provide more value to customers and charge more for your product.

✓ Make your product the center of your customers’ ecosystem. When your product is the one providing integrations between your customers’ business apps, driving their data flows, and automating their processes, it becomes the hub of their ecosystem rather than just another app in their tech stack.

✓ Increase product stickiness and reduce churn. Integrations can provide a strong moat, making your product difficult to replace. Businesses are typically unwilling to take a step backward in automation and connectivity, so if your product is deeply integrated, replacing it would require your customer to find a competing product that can provide every single one of its integrations – not an easy task.

✓ Be strategic about what not to build. When the market demands a feature that would require heavy R&D effort or simply doesn’t fit your product roadmap, you can choose not to build that feature and instead integrate with an application that provides it. This allows you to meet customer and prospect demands while staying focused on what your application does best.

Common approaches to integration delivery

Historically, software companies have taken a variety of approaches to delivering product integrations to their customers, each with its own benefits and drawbacks. Most likely, you have experimented with one or more of those approaches and have experienced some of the associated pain points for yourself.

Put the integration responsibility on the customer. While putting the responsibility on customers to build their own integrations may seem like a straightforward solution, this approach is a non-starter in an increasing number of markets. If you don’t agree to provide the integrations your prospects require, there is typically a competitor waiting right in line behind you who will.

Use a third party to build integrations. Involving a third-party firm to provide integration services to your customers keeps the work off of your team. However, there are significant drawbacks: you give up revenue, you give up control over the quality of the integration, and you add the complexity of introducing a third party into your customer relationship. Additionally, customers in many markets simply won’t accept such an arrangement.

Use a traditional iPaaS and build around it. Some software teams find creative ways to use traditional iPaaS solutions to deliver integrations to their customers. As noted above, these iPaaS solutions are designed for building internal integrations. They offer low-code integration designers and large SaaS connector libraries that make it easy to build one-off integrations. However, providing integrations to customers involves a lot of additional complexity that traditional iPaaS solutions simply don’t address:

  • Traditional iPaaS doesn’t have the concept of customers, or customer-specific configurations or credentials, and thus does not offer a way to build reusable integrations that can be deployed to multiple customers. Teams attempting to use traditional iPaaS for customer integrations have to deploy an instance of the iPaaS for each customer and/or rebuild similar integrations for each customer.
  • These solutions lean heavily on a no-developer, low-code mindset, which leaves teams stuck when they need to build a complex integration or connect to an app that’s not supported.
  • Traditional iPaaS solutions can’t be easily incorporated into software teams’ existing systems, so you end up with integration tools and processes that are completely cut off from the rest of your dev environment.
  • Traditional iPaaS doesn’t provide a way to deliver integrations as a native, in-app experience.

Build integrations and integration tooling in engineering. Aside from embedded iPaaS, this is the most common approach we see software companies take to delivering customer integrations. You get the strategic benefits of integrations described above, you keep the revenue, and you control the quality of the integration experience for your customers. Most companies find, however, that building integrations in-house does not scale well and comes with some very significant disadvantages:

  • Building integrations and tooling in-house requires a very large engineering effort that distracts from core product work.
  • Teams typically build up a long backlog of integrations that slows down sales and onboarding.
  • It can be difficult to get integration infrastructure right, especially security and scalability concerns.
  • You spend a lot of time building things such as integration logging that are irrelevant to your domain.
  • Building the tooling to empower less technical team members to deploy and support customer integrations is too time-consuming and expensive to do right, so most teams don’t. Integration deployment and support then remain long-term engineering responsibilities.

Signs you would benefit from an embedded iPaaS

Having worked with many software teams who have struggled to deliver integrations effectively using these approaches, we have identified some common indicators that a team would benefit from implementing an embedded iPaaS.

If you’re a startup, or a new division or product line within an established company:

✓ Your prospects and customers frequently ask for integrations that you haven’t built.
✓ Your competitors have integrations you don’t offer yet, and you need to catch up quickly.
✓ Your developers are spending time building integrations instead of working on your core product.
✓ Your developers are spending time more time than you anticipated building integration infrastructure and tooling to deploy integrations to customers, monitor them, and introspect when something goes wrong.
✓ Integrations are slowing down your overall pace and time to market.
✓ You have a small engineering team and lack expertise surrounding integration patterns and best practices.
✓ You or your customers have concerns about your integrations’ reliability, scalability, security, or compliance.
✓ You’re concerned that your current integration strategy won’t scale well as you grow.

If you are a scaleup or enterprise company:

✓ You’ve already built many integrations, but you still have an ever- growing backlog of integrations that need to be built.
✓ Missing integrations are causing friction in sales and implementation; you’re losing deals and delaying new customer onboarding because you can’t quickly deliver needed integrations.
✓ You’re unable to innovate on your core product as quickly as you once did because integrations now consume a significant portion of your R&D capacity.
✓ You’ve built up integration tech debt that makes internal improvement difficult.
✓ You’re encountering reliability and scalability problems with the integrations you have already built.
✓ Your engineering teams spend significant time on integration maintenance and support.
✓ You’re delivering integrations as services or “bolt-ons” rather than a first-class part of your product experience, and adoption is low because your customers don’t have a way to discover or self-activate the integrations you already provide.

Key benefits of embedded iPaaS

Given the increasing importance of customer integrations and the numerous challenges that come with common approaches to delivering them, many B2B software companies find themselves looking for a better solution.

Embedded iPaaS evolved to give B2B software companies a more efficient, cost-effective, and scalable strategy for providing customer integrations. There are many compelling reasons to adopt an embedded iPaaS.

Reduce engineering effort

Building integrations and integration tooling in-house requires extensive engineering time and resources. Using an embedded iPaaS significantly reduces that burden.

Embedded iPaaS solutions feature a low-code integration designer and a library of pre-built SaaS connectors and logic components. These empower non-developers to build many of the integrations your customers need by assembling components in the low-code environment, without engineering involvement. Meanwhile, your developers can focus on core product work.

Offload infrastructure work

Standing up and maintaining infrastructure to run integrations is incredibly time-consuming and requires a lot of dev or DevOps effort outside your core product.

When you implement an embedded iPaaS, your integrations run within the platform’s purpose-built infrastructure, which abstracts integration security and compliance concerns from your team. Your embedded iPaaS infrastructure will also handle performance concerns such as scaling and bursting, so you can count on your integrations to run smoothly no matter how many you run or how often you run them.

Your embedded iPaaS vendor will also handle all integration infrastructure maintenance, such as monitoring, security patches, upgrades, and backups, leaving your team completely free of integration infra work.

Productize your integrations

Integrations are often treated as services, built as “one-offs” to meet a single customer’s needs. Not only does this waste time and create a maintenance headache, but the resulting integration experience for customers is far from ideal: you end up delivering poorly maintained, unpolished integrations that feel bolted onto your product as an afterthought.

An embedded iPaaS provides everything you need to productize your integrations and deliver them as a first-class part of your overall product offering. Their low-code integration designers empower your team to build reusable, configuration-driven integrations that can be deployed to many customers. They also make it straightforward to define a simple configuration UX that is used by customers or customer-facing teams to deploy integrations with customer-specific credentials and configurations. Finally, they provide an integration marketplace that you can embed in your product, enabling your customers to explore and self-activate integrations.

The end result is native integrations that look and feel as polished as the rest of your product.

Respond faster to customer and market demands

Embedded iPaaS significantly accelerates teams’ ability to deliver integrations by enabling non-developers to build them, without waiting for engineering resources. This frees teams to rapidly create needed integrations instead of sending them to the integration backlog or waiting for engineering resources. That empowers teams to quickly deliver integrations needed to create a proof of concept, say yes to a prospect’s integration request, reach a new market segment, or meet evolving customer needs.

Onboard new customers faster

Integrations can be a major source of risk and delay in new customer onboarding. New customers’ integration needs often get stuck in an engineering backlog, and when they eventually come to the forefront, there’s often poor communication between customers, services teams, and engineering teams regarding integration requirements.

Embedded iPaaS solutions enable non-developers to build integrations so you can skip the engineering backlog and deliver new customers’ integrations quickly. They also enable integration delivery by teams who work more closely with customers, which can streamline communication, and provide tools for rapid testing and iteration to make sure new integrations work as expected.

Provide better integration support

Many teams lack the tooling necessary to provide high-quality support for their customers’ integrations. Customers are often the first to know when an integration fails to run, and support staff are left scrambling to determine what went wrong, often needing to call in engineering teams to access logs.

Embedded iPaaS solutions give customer-facing teams a straightforward integration management environment with powerful logging, monitoring, and alerting tools, enabling them to provide proactive integration support and investigate quickly if something goes wrong.

They also provide end users with logging and alerting tools as part of the embedded marketplace. This empowers customers with a self-serve support experience, allowing them to answer many of their own questions and reducing support volume for internal teams.

Tips for evaluating embedded iPaaS solutions

There are several steps you should take and factors you should consider carefully when selecting the best embedded iPaaS for your company.

Include the right stakeholders in your evaluation

Involving the right stakeholders in your selection process will set you up to conduct a successful comparison of embedded iPaaS vendors and choose a platform that will truly enable faster and easier integration delivery compared to your current approach.

It’s typically helpful to include a product leader who is ultimately responsible for integration strategy, the leader of your integration team if you have one, and representatives of your engineering team who have previously been involved with integration delivery.

Conduct a realistic proof of concept

It’s critical to prove out that the solution you’re considering can support the types of integrations you need to build. Keep in mind that integrations vary widely from one to the next, and that a demo showing a straightforward automation between two common SaaS apps does not necessarily indicate that a platform can support a complex integration between your product and a niche third-party system for which there’s no built-in app connector.

Conduct a proof of concept in which members of your team use the proposed platform to build out one or more integrations that represent the integrations you typically encounter. Many teams simply build out the next integration from their existing backlog to ensure the platform can handle their needs.

Evaluate solutions’ handling for real-world complexity

As part of your proof of concept, investigate whether the embedded iPaaS you are considering is sufficiently powerful and flexible to support the range of integrations you need to build.

Integrations in the real world are complex. In our experience, almost every integration B2B software teams need to build is “messy” in some way: imperfect third-party APIs, non-standard auth, data mapping that varies widely between customers, automatic retry needs, and so on. Ensure that the platform you’re considering handles whatever types of complexity you tend to encounter.

Evaluate solutions’ extensibility & custom component support

Extensibility is critical. Many B2B software teams serve customers in niche vertical markets and frequently need to integrate with niche applications or handle logic that’s highly specific to their own industry. If that is your situation, you’ll want to consider that even the biggest library of build-in API connectors won’t include connectors to many of the apps you need to integrate with.

That’s why it’s important to choose a solution that offers robust custom component (or custom connector) support. Note that custom component support varies widely between embedded iPaaS solutions. Some do not offer custom component support at all. Some only allow you to build lightweight custom components that wrap APIs. Some allow you to build true custom components but require you to contact the vendor to publish them, which makes it hard to build and iterate quickly.

As part of your proof of concept, confirm that your solution offers a dev-friendly SDK for writing powerful, reusable custom components, and test out the experience of actually building and publishing one. This ensures you can extend your embedded iPaaS solution’s low-code integration designer to fit your product and industry, which is necessary for truly enabling non-developers on your team to build any integration your customers need.

Seek an embedded iPaaS that’s optimized for your use case

As you evaluate embedded iPaaS options, consider whether the solution you choose is truly optimized for your use case and whether the vendor’s main focus is serving software companies.

It’s important to be aware that some embedded iPaaS solutions are provided by vendors who built traditional iPaaS solutions and later added functionality on top of them to create embedded versions of their platforms. In our experience, those solutions can feel like “retrofits” that lack important functionality because they were designed for internal workflow automation rather than for use by software companies that need to provide reusable integrations to customers. We’ve encountered retrofit solutions, for example, that do not provide handling for deploying different versions of an integration to different customers, which is a pretty important feature for managing customer integrations at scale.

Ensure your solution fits your existing tools & processes

Finally, consider that for almost any tool to be successfully adopted within a software company, it must fit well into your existing ecosystem.

Investigate whether solutions you’re considering can be easily incorporated into your existing tools and processes such as source control, CI/CD pipeline, logging platforms, incident response systems, and so on. This will ensure your integration delivery can be smoothly incorporated into the way you build, deploy, and support your core product.

Conclusion

Delivering integrations to your customers can be a challenging task. It typically takes a great deal of engineering time, slows your sales and onboarding efforts, distracts from core product innovation, and for many B2B software teams, represents a weak point in the overall customer experience.

Embedded iPaaS offers a proven, scalable solution for providing customer integrations and can help you transform your integration delivery into a powerful strategic advantage.

Prismatic is a powerful embedded iPaaS designed to give software teams an easier way to provide integrations to their customers. If you’re interested in building out a scalable integration strategy for your product, contact us to learn more.

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