Every M&A integration plan includes system integration. Every integration plan underestimates the complexity. API assessment during due diligence is the difference between a 6-month integration and an 18-month nightmare.
Why API Assessment Matters
Post-acquisition, you'll need to:
- Migrate customer data to buyer's systems
- Synchronize product and pricing information
- Consolidate financial reporting
- Integrate identity and access management
- Connect monitoring and operations
All of this depends on APIs. If the target's APIs are poorly designed, undocumented, or non-existent, each integration becomes a custom development project.
API Quality Indicators
Documentation
- Do APIs have current, accurate documentation?
- Are examples and use cases provided?
- Is the documentation machine-readable (OpenAPI/Swagger)?
Design Quality
- Do APIs follow consistent patterns?
- Are resources properly modeled?
- Is versioning implemented?
- Are errors handled consistently?
Authentication & Security
- How is authentication implemented?
- Are appropriate authorization controls in place?
- Is rate limiting implemented?
- Are APIs secured with TLS?
Reliability
- What's the API uptime history?
- How are API changes communicated?
- Is there a deprecation policy?
Integration Complexity Assessment
For each planned integration, evaluate:
Data Mapping
- How do data models map between systems?
- Are there semantic differences in seemingly similar fields?
- What transformations are required?
Sync Requirements
- What's the data freshness requirement?
- Is real-time sync needed, or is batch acceptable?
- How is conflict resolution handled?
Volume and Performance
- What data volumes will flow through integrations?
- Can APIs handle the required throughput?
- What's the latency requirement?
Red Flags in API Assessment
- No APIs: Data access requires direct database queries—fragile and risky
- Undocumented APIs: Every integration requires reverse engineering
- Inconsistent APIs: Each endpoint works differently, multiplying integration effort
- No versioning: Changes break integrations without warning
- Authentication by IP whitelist: Outdated security model that complicates integration
- SOAP-only: Legacy technology that increases integration complexity
Quantifying Integration Effort
We categorize integrations by complexity:
Simple (1-2 weeks each)
- Well-documented REST APIs
- Standard authentication (OAuth, API keys)
- Clear data mapping
- Existing integration tools/connectors
Moderate (4-8 weeks each)
- APIs exist but need custom development
- Some data transformation required
- Custom authentication handling
- Performance optimization needed
Complex (12+ weeks each)
- No APIs—direct database integration
- Significant data model differences
- Real-time sync with conflict resolution
- High volume/performance requirements
Case Study: The Integration Timeline Explosion
A strategic acquirer planned a 6-month integration for a $15M acquisition. The target had "comprehensive APIs" per due diligence materials.
Reality discovered post-close:
- APIs existed but hadn't been updated in 2 years
- Documentation was for a previous version
- Authentication required a deprecated OAuth flow
- Rate limits would require 3 months to sync historical data
- Critical data was only accessible via direct database queries
The 6-month integration became 14 months. Additional cost: $600K in integration development. Three customer escalations during the extended timeline.