Expense reporting is always, in my experience, very painful. Filling out a poorly-formatted spreadsheet masquerading as an “expense claim form,” printing it out, stapling receipts to the form, realizing you’ve lost a crucial receipt, and then the inevitable back and forth before reimbursement. It’s a messy business, and something that we shouldn’t really have to do in 2009.
Expensify, a startup that aims to take the pain out of expense reporting, launches in public beta today. The free service streamlines the process of handling expenses and, thankfully, largely does away with paper receipts. It should prove useful to all kind of web workers, from freelancers to road warriors.
After the simple sign up, you’ll see that Expensify is a three-step service: import your expenses, scan your receipts, and generate expense reports.
The first step is importing your expenses. If you have an existing credit card for expenses that you’d like to use with Expensify, you can import expenses from it. Expensify works with 94 percent of all credit cards in the U.S. In order to import your expenses, you have to give it your online banking username and password, which you might not be comfortable with (it’s worth noting that Expensify does have full PCI compliance). If you’d prefer not to do that, or you don’t have a card to use for expenses, Expensify can set you up with a free prepaid Mastercard. This card can be loaded up from your regular credit or debit card and helps you keep business expenses separate from personal expenses.
For cash purchases, you can import expenses via SMS, email or though the web site.
Any receipts that you have can be added to Expensify in a few ways. First, and this is Expensify’s killer feature, if your receipt is for under $75 you can just toss it in the trash, as Expensify can generate a guaranteed eReceipt from imported expenses. The eReceipt carries just the same legal weight with the IRS as your original receipt, so now there’s no reason to keep it. For receipts with a value over $75, you can use your cameraphone to snap a picture of the receipt and upload it to Expensify (or if you have an iPhone, there’s an app you can use instead). Receipts you get via email can just be forwarded to a custom email address.
Generate expense reports
Once your expenses have been imported and receipts added, it’s just a question of generating your report — Expensify automatically includes the receipts as required — and forwarding it to whoever needs to approve your expenses. The manager has the choice of paying the reimbursement online or through payroll.
Although there are other players in this space, most notably American Express’s Concur, Expensify comes at the problem from a different angle. Unlike other tools that are typically designed with the CFO in mind, Expensify targets the requirements of the person filing the expense reports, which means that it’s very easy to use — once it’s set up you can generate expense reports with a single click. Expensify is free, which compares favorably to Concur’s upwards of $140 per month. Expensify CEO David Barratt says that the app is aimed at smaller companies, from sole proprietors to companies of about 100 employees (larger companies usually have other requirements such as integration with complex accounting systems). Further premium options will be added later, but the base functionality should remain free.
Expensify certainly streamlines the process of handling expense claims, and, if nothing else, not having to keep hold of lots of paper receipts is a very attractive proposition. While the design of the beta site isn’t exactly to my taste, the app does seem to do what it promises — expense reporting that doesn’t suck — very well.
What do you use for handling expense claims?