AI-powered supply chain productivity platform Augment has acquired Merlin, a stealth startup focused on wholesale distribution AI, marking Augment’s formal entry into the sector.

Merlin was founded by Applico Capital partners Alex Moazed, Nick Johnson and John Schumacher, the former head of AI at Grainger. The company has operated quietly with early enterprise distribution customers including Ewing Outdoor Supply, Insco Distributing, Brooks Safety Solutions and Reece — representing more than $20 billion in combined distributor revenue.

As part of the deal, Moazed joins Augment as President of Wholesale Distribution, alongside Johnson and Schumacher.

Augment — which has raised $110 million and built its platform around “Augie,” an AI teammate for logistics workflows — said the acquisition extends its capabilities beyond brokers, carriers and shippers into wholesale distribution, a U.S. market valued at more than $8 trillion.

“Distributors represent one of our most vital industries. Without them, hospitals run out of vital supplies, factories grind to a halt and home builders can’t build — yet they still run on legacy systems and spreadsheets. That changes now,” Augment Co-Founder and CEO Harish Abbott, said in a news release. “Alex and his team have harnessed AI to solve real business problems for distributors, and their product connects seamlessly with what Augie already does. Now Augie reaches further across the supply chain than ever before.”

With over 110 engineers in North America, the company positions Augie as an AI system that automates complex, multi-step workflows across communication channels and enterprise systems, supporting processes from quote to cash. Its existing customer base includes logistics operators such as Armstrong Transport Group, Echo Global Logistics and Penske, among others.

Merlin’s technology is designed specifically for the operational complexity of distribution — including fragmented ERP environments, inconsistent product data and highly variable quote-to-cash processes across branches and business units. Augment said those dynamics have limited the effectiveness of point AI tools and traditional automation approaches.

“For the past decade, we’ve seen firsthand the challenges facing B2B distributors. AI is finally ready to solve them — but no provider was meeting the needs of enterprise wholesale distributors,” Moazed added. “Our top priority is putting the customer first. This industry runs on trust, and distributors rely on us not only to deliver AI automation, but to safeguard their data, one of their most valuable assets.”

With the integration, Augment aims to offer distributors a unified AI platform that adapts to each company’s workflows using natural language rather than custom-coded integrations. The system is designed to ingest unstructured inputs such as emails, PDFs and phone communications, convert them into structured ERP actions and automate tasks such as order entry, quoting and portal management.

Early users cited productivity gains, with Ewing noting significant reductions in time spent on quoting tasks.

The acquisition reflects a broader push to apply AI to distribution’s operational backbone — particularly in areas where manual processes, fragmented systems and SKU complexity have historically limited automation at scale.