Latin American business-to-business (B2B) payments platform Flexio has raised $3m through a seed financing round led by Costanoa Ventures.

Latitud Fund, Soma Capital, Omri Mor, Daniel Kahn, and Diego Oppenheimer joined the round along with a number of LatAm founders and Y Combinator alumni.

Flexio specialises in automating accounts payable (AP) and accounts receivable (AR) for small and medium businesses (SMBs) by facilitating payouts, pay-ins, communication, and integrations with enterprise resource planning systems (ERPs) and accounting software.

The company said that it will utilise the fresh funds to enhance its offerings to help businesses automate bill payments and invoicing. The firm also plans to ramp up the team and sales.

Flexio CEO and co-founder Nathan Schorr noted: “The traditional processes are inefficient and arduous, preventing timely payments and using up valuable employee resources while also negatively impacting cash flow management.”

According to data by World Bank, the B2B electronic payments reached $180bn in transactions in 2020 in Mexico alone.

SMBs, which makes up for the 70% of the region’s GDP, are faced with challenges to manage data entry and approvals across multiple communications channels as the process remains majorly manual.

Costanoa Ventures partner Amy Cheetham said: “Nine billion invoices were processed in Mexico alone in 2020. By focusing on SMBs doing business in Mexico, Flexio is providing a much-needed service for an underserved market.

“We couldn’t be more excited about the Flexio team and the technology they are creating to address this huge market opportunity.”

Last week, Latin American B2B payments and financing platform Tribal raised $60m to build out its teams in Brazil, Mexico, Colombia, Peru, and Chile.