Just out of YC, Plug Receives $2.7M to Simplify Payment Processing Integration

The company, which is based in Rio de Janeiro, can speed-up the integration process from a couple of months to just a few days.

Plug allows merchants to integrate with up to 11 "connections" through one API.
By Marcella McCarthy (EN)
November 17, 2021 | 07:00 AM
Reading time: 3 min.

Miami — For e-commerce businesses, a failed credit card transaction likely means a lost sale. That’s because 62% of customers who have a credit card declined, won’t take the time to try again or to try another card. And in Brazil, according to Plug, a new Rio de Janeiro-based startup that makes it easy for companies to integrate with multiple payment providers very quickly, about 15% of online transactions are declined for various reasons.

“Brazil has the worst acceptance rate in Latin America...costing the industry $15 billion in lost sales,” said Alex Vilhena, CEO and co-founder of Plug.

The truth is, companies have to make the checkout process as frictionless as possible. But while it needs to be a smooth process for the customer, setting it all up and making sure the tech works -- all the time -- is still a huge pain point for companies.


For an online business to accept payment they need to integrate with payment providers, and it’s a costly process because it can take months of a developer’s time. And even the best payment processors aren’t up 24/7. Take the 2 hour outage that Stripe had a few years ago. If your business was only integrated with Stripe, then your checkout was down for 2 hours, too.

“But integrating with multiple payment providers is a huge undertaking for any online business,” said Vilhena. Plug aims to solve this, and today the company announced the closing of a $2.7 million seed funding round. Plug, which was part of Y Combinator’s Summer 21 batch, currently allows customers to integrate with up to 11 “connections” which include multiple payment processors, the ability to accept local payment methods like Pix and boletos, fraud protection and reconciliation. It does all this through a simple API.

“We’ve built a routing system, so if one payment processor doesn’t work, another one will pick up the payment,” Vilhena told Bloomberg Línea.

Co-founders of Plug: Marcel Nicolay, Alex Vilhena, Thiago Garutidfd

Companies may choose to have multiple payment providers for additional reasons, too. For example, in Latin America, Stripe doesn’t accept American Express, but Cielo, a large Brazilian payments provider, does. As a result, Vilhena said, some of their clients need to integrate with both Stripe and Cielo.


“[Integrating] takes a long time, it doesn’t work well, and you have to do it over and over again,” Vilhena said.

Integrating isn’t a one-time deal for a couple of reasons. First, like smart phones, there are often updates to the technology, and unlike a smartphone, they aren’t automatic - it’s something that has to be done about once a year, Vilhena said. Also, for businesses with high volumes of payments, a payment provider’s fee structure can really affect the bottom line.

“Another reason they may change on a yearly basis is because one provider could offer better rates, but then next year, another provider can offer more functionality,” Vilhena said.

Plug allows you to change payment providers almost instantaneously. “It’s not a self-service function - yet,” Vilhena said, though it’s something they are working on.

And the integration with Plug itself can range from just a few days to a couple of weeks, Vilhena said, citing that one of their clients was up and running in just 2 days, an extremely short amount of time in the payment processing world.

The details and the backstory

Plug launched in May 2021, and is the brainchild of Vilhena, Thiago Garuti, and Marcel Nicolay - three Cariocas with payment backgrounds. Vilhena, who previously worked at Braintree - a large payment provider - in Europe, often heard complaints from Nicolay, who was his client, that the integration process took so long.


“He used to complain to me, ‘I’ve been at this company for three years, and this is the seventh integration I’ve done,”’ Vilhena said.

The two recruited Garuti and decided to start a company that would solve this problem, and today Nicolay is CTO and Garuti is COO.

While in its infancy, the company has more than twenty clients, many of which facilitate payments for many hundreds - if not thousands - of smaller businesses.

Plug is made up of 13 full-time employees, and one of the things the company will do with the money from this round is expand its team. The company has raised just over $3 million to date. This round was led by Costanoa, with participation from QED, Verve Capital, Latitud and Norte Ventures.