Receipt AI

We Built A $1.5K/Mo AI App For Receipts

December 24th, 2024

Who are you and what business did you start?

My name is Queenie Peng, and along with my co-founder Ian Heraty, we run Receipt-AI.com. We help busy, traveling teams manage their receipts effortlessly using AI and SMS.

What sets Receipt-AI apart is its SMS-based receipt upload feature and the ability to reconcile expenses in Xero and QuickBooks online with one-click.

Users simply send a picture of their receipt using SMS, and Receipt-AI takes care of the rest: extracting data, renaming files, categorizing expenses with AI, ensuring secure storage, and uploading them to Xero or QuickBooks online for reconciliation. This SMS functionality allows receipt management to happen anytime, anywhere, without the need to download additional apps, making it exceptionally accessible and convenient.

Adding a memo like 'Lunch with Jason about the Q3 project' in your text message can help you remember the receipt later.

Our office - coffee shops :)

How do you come up with the idea for Receipt AI?

We keep an idea book where we write down every idea we come up with and rate it based on three metrics (on a scale of 1-5):

How big is the idea?
Founder-market fit.
How painful is the problem?

The key is not to judge an idea before putting it in the basket. This process helps us stay objective and organized when evaluating potential opportunities.

Before Receipt-AI, we ran a food truck booking website called Popping.live. At its peak, we helped over 100 organizations in Chicago book food trucks. Despite our best efforts and passion, we realized that no matter how high our IQs were, we couldn’t make the business profitable. It was a tough lesson, but it taught us something valuable: Ideas matter. Execution is critical, but choosing the right problem to solve can make all the difference.

Receipt-AI stood out because it’s something we truly enjoy working on, and we love serving our customers. Before launching, we built a simple landing page with an annual payment option only and announced on LinkedIn that we were launching in a month. To our surprise, a customer signed up immediately—Igor, you da man! That was our “aha” moment: clear validation that the problem was real, the solution resonated, and we were onto something meaningful.

Previous product before Receipt-AI: Popping.Live - La Mixteca food truck, if you go there, tell Isreal Queenie and Ian said hi!

How did you build the initial version of Receipt AI?

My co-founder and I are both skilled developers, which gave us a significant advantage when building our MVP (Minimum Viable Product). Here’s how we approached it:

The First Step: We focused on solving the core problem—making receipt management as effortless as possible. We prioritized building an SMS-based upload feature because we knew simplicity and accessibility would be key for our users.
Costs: Since we handled the development ourselves, our costs were minimal. The main expenses included server costs, third-party services, and website hosting fees.
Tools We Used: We leveraged modern developer tools and platforms like Ruby on Rails, including cloud services for hosting and storage. We also incorporated tools for SMS functionality, AI data extraction, and integrations with Xero and QuickBooks.
The Business Model: We chose a subscription-based model from day one. It’s simple, scalable, and aligns with the value we deliver to our customers. This model has stayed consistent as we’ve grown.
Financing the Business: We funded everything ourselves. With our technical background, we avoided the need for hiring outside developers or seeking external funding. We firmly believe that, especially in SaaS, early-stage fundraising can be a distraction from building a product customers genuinely love.
Timeframe: It took us about 3 months to get the first version ready for launch. While we had the skills to build quickly, the process was still challenging. We encountered unexpected errors, edge cases, and other hurdles—typical for any development project.

The Experience: Building the first version was harder than it looked on paper, but it was also incredibly rewarding. Being able to see our idea take shape and solving real customer problems kept us motivated throughout the process.

Queenie Peng is working on Receipt-AI.com in a coffee shop.

Receipt-AI.com founders: Queenie Peng and Ian Heraty.

Receipt-AI.com

Linkedin: Queenie Peng

Linkedin: Ian Heraty

Receipt-AI.com Receipts 🧾

Made in the USA, Receipt-AI uses AI and SMS to automatically categorize your receipts based on your chart of accounts, simplify the bookkeeping process, and sync them with Xero or QuickBooks Online, ready for one-click reconciliation.

How did you launch Receipt AI and get initial traction?

To get the word out, we launched Receipt-AI across multiple platforms: Product Hunt, LinkedIn, X, Reddit, and other social media channels. We knew that launching isn’t a one-time event but an ongoing process. You need to repeat yourself so many times that people start to remember Receipt-AI.  The initial response was overwhelmingly positive. People were supportive and excited about the problem we were solving. We also received valuable early feedback that helped us refine our product. One comment from Noteng, an early supporter:

“Making expense reports is PITA. I used to travel for work and it was such a pain to record all my receipts and make the report I would just not do it for a lot of stuff and just pay out of pocket for my own expenses while traveling (food, random cab rides, etc). With Receipt-AI, I can just text all my receipts while on a trip and that is really helpful.”

We made our first sale from our waitlist. We kept things simple: our landing page offered an annual payment option only. That bold approach helped us validate the product’s value quickly—if someone was willing to commit for a year, we knew we were solving a real pain point.

What was the growth strategy for Receipt AI and how did you scale?

Our growth strategy is simple: provide value first. Every time I post online—whether on LinkedIn, X, or Reddit—I focus on sharing something genuinely useful for our audience. I believe the secret to entrepreneurship lies in delivering so much value upfront that people naturally want to buy from you.

This approach mirrors what we’ve seen with great thought leaders like Alex Hormozi and Dave Ramsey. They’ve built massive followings by giving away incredible amounts of value for free, creating trust and goodwill with their audience. That trust turns into customers who are happy to pay for their products.

What were the biggest lessons learned from building Receipt AI?

Just like every other startup founder, we were learning a lot of new things: registering a company, figuring out product-market fit, doing sales during the day and working on the product at night.

Among all these tasks, one problem has stood out to us: Bookkeeping and taxes, filled with terminology and the support is often limited. As a founder, I had to pick up an accounting software, work on our books, we spent hours watching tutorials, asking our friends for help, and finally got the hang of it. I still remember how steep the learning curve was.

That’s the beginning of Receipt-AI.

Key lessons:

Solve Your Own Problems: The best business ideas often come from solving a problem you’ve personally experienced. When you feel the pain deeply, you’re more equipped to understand and fix it for others.

Learn Relentlessly: As founders, we had to become generalists. Whether it was sales, bookkeeping, or marketing, we embraced learning new skills because nobody else would do it for us.

The Power of Focus: You don’t need to solve every problem—just solve one painful problem really well. For us, that was simplifying receipt management for busy traveling teams.

Remember, the steepest learning curve leads to the biggest breakthrough.

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