How to Build an AI Interior Design App Like Modsy

AI-powered interior design apps have quickly become a popular tool for home decor enthusiasts. Apps like Modsy are making it easier than ever for people to bring their dream spaces to life by offering virtual design consultations and personalized recommendations. With just a few clicks, users can experiment with different styles, layouts, and furniture pieces, all from the comfort of their homes.

As more people look for ways to decorate their homes on their own terms, the demand for these virtual design tools is growing fast. Not only do these apps help users save time and money, but they also create opportunities for businesses to earn through subscription models, partnerships with furniture brands, and premium services.

This blog will walk you through the essential steps to build a similar app, positioning your business at the cutting edge of the interior design industry.

Overview of the Modsy App

Modsy is an AI-powered interior design app that lets you redesign and visualize your space virtually. Using 3D rendering, machine learning, and professional designers, Modsy provides personalized home decor recommendations, making it easy to create your dream interior without the hassle of traditional interior design services.

• Virtual Room Staging – Users can upload photos of their room, and Modsy turns them into a customizable 3D model.
• AI-Powered Style Recommendations – Users get suggestions for furniture and decor based on their style.
• Shop Directly from the App – Users can buy recommended items instantly, so no extra browsing is needed.
• Hybrid Human + AI Design – For a premium experience, users can also work with professional designers.

How does Modsy work?

• Sign Up & Style Quiz: Users can either download the Modsy app or visit the website. The journey starts with a style quiz, where AI analyzes users’ preferences in colors, furniture styles, and budget.
• Upload Your Room: Users take photos of their space (smartphones work perfectly), and input room dimensions. If users are unsure about the measurements, Modsy’s AI can help estimate them.
• AI Generates a 3D Model: Modsy’s AI scans the photos and creates a digital twin of the room. The system suggests initial furniture arrangements based on algorithms designed to optimize the layout and style.
• Human Designer Refines the Plan: A professional designer reviews the AI-generated layout and provides two custom design concepts based on different themes, such as modern, cozy, or eclectic.
• Interactive Customization: In the 3D viewer, users can tweak layouts, swap out furniture, or adjust colors. Users can also request revisions depending on the plan they’ve selected.
• Shop Directly in the App: Once users are satisfied with the design, Modsy’s AI links them to furniture and decor from retailers like Wayfair, West Elm, and others. Users can purchase items directly through the app with just one click.

Key Market Takeaways for AI Interior Design Apps

According to VerifiedMarketResearch, the Virtual Interior Design Services Market is set for substantial growth, projected to rise from USD 20.24 billion in 2025 to USD 34.43 billion by 2030, with a CAGR of 11.21%. 

Source: VerifiedMarketResearch

AI-powered interior design apps are gaining popularity for their ability to offer cost-effective and efficient ways to visualize and customize spaces. For example, VR tools allow users to explore digital models of homes, make instant changes, and avoid costly errors in construction. 

Apps like Modsy, Havenly, and HomeByMe utilize AR/VR technologies to provide detailed 3D renderings, while AI-driven platforms help streamline the design process by providing automated suggestions based on user preferences. 

Plus, integration with e-commerce giants like IKEA and Wayfair makes it easy for users to go from visualizing to purchasing their dream furniture, enhancing convenience.

Strategic partnerships are further accelerating the adoption of these apps. For instance, HTC VIVE partnered with Immersion to create TrueScale, a VR app that offers a detailed home decoration experience. 

A Perfect Time to Invest in Developing an AI Interior Design App

Starting an AI-powered interior design app like Modsy is a fantastic business idea, especially with the growing trend of people looking for personalized and convenient home design solutions. With more people shopping online and looking for virtual consultations, AI-driven apps are becoming a popular choice for homeowners and designers alike. 

These apps can use AI to offer customized design suggestions, automate parts of the design process, and even integrate AR to help users visualize their spaces. This tech-driven convenience makes it much easier for people to create beautiful, personalized interiors without the need for professional designers.

Two great examples of AI-powered interior design apps are Modsy and Havenly. Modsy, which combines AI with 3D visualization to create virtual room designs, generated about $20 million in revenue in 2020. 

Another app, Havenly, offers personalized design services and raised $35 million in funding in 2020, showing strong growth. 

As the home decor industry continues to embrace digital transformation, an AI interior design app has a lot of potential to thrive and become very profitable!

Business Model of the Modsy App

Modsy is an AI-powered interior design platform that blends cutting-edge technology with personalized home styling. By combining subscription revenue, e-commerce partnerships, and premium design services, Modsy has developed a scalable and profitable business model for modern interior design. 

Design Package Subscriptions (Primary Revenue Source)

Modsy offers a variety of design packages that cater to different user needs. Here’s how it works:

• Basic Package ($79) – Includes AI-generated design suggestions for the user’s space, based on photos uploaded to the platform.
• Premium Package ($299+) – Includes 1:1 collaboration with a professional designer, offering a more tailored experience.
• Pro Package (Custom Pricing) – Designed for real estate agents, interior designers, and businesses that need large-scale or multiple-room redesigns.

E-Commerce Commission & Affiliate Revenue

Modsy has formed partnerships with major furniture retailers like Wayfair, Crate & Barrel, and West Elm. Through these partnerships, the app earns commissions on purchases made through the platform.

• Commission: Modsy earns 10–20% commission on furniture sales made via the app.
• Affiliate links: Modsy also includes affiliate links, earning a cut of sales even if users don’t buy immediately.

Estimated impact:

Around 30% of Modsy’s revenue comes from e-commerce, based on industry standards. Users tend to spend 2–3 times more when shopping via Modsy because they feel more confident in their decisions thanks to the virtual staging and 3D previews.

White-Label & B2B Services

Modsy doesn’t just cater to individual users. It also works with businesses to provide virtual staging and product placement. These services add a valuable B2B component to the company.

• Virtual Staging: Real estate agents use Modsy’s virtual staging for property listings, which can cost between $500 and $2,000 per property.
• Product Placement: Furniture brands can pay Modsy to feature their products in design suggestions, generating additional revenue through sponsored placements.

Modsy’s Financial Performance & Growth

Modsy has seen impressive growth and has been able to scale effectively, though it faced challenges along the way. Here’s a snapshot of its financial performance:

• Annual Revenue: Around $25M.
• Gross Margin: Approximately 60–70%, which is high due to the digital-first model that doesn’t require the overhead of physical storefronts or traditional design services.
• Customer Acquisition Cost: Estimated at $150–200, largely driven by paid advertising and strategic partnerships.
• Lifetime Value: Modsy’s LTV is estimated at $500+, as many users return to the platform for additional rooms or to purchase furniture through the app.

Modsy’s Funding & Valuation

Modsy’s growth has been fueled by venture capital, with the company raising over $72.7 million before pivoting to profitability.

• Series A ($8M, 2016) – Backed by GV (Google Ventures) and Norwest Venture Partners.
• Series B ($23M, 2018) – Funded by Advance Ventures and Comcast Ventures.
• Series C ($37M, 2020) – Supported by TCG and Birchmere Ventures.

Peak Valuation: Approximately $200M in 2020.

Why Investors Backed Modsy?

• AI + E-Commerce Synergy: Investors were drawn to the high-margin revenue generated from furniture sales through Modsy’s platform
• Scalability: The digital-first model allows Modsy to quickly scale up and expand without the constraints of physical locations.
• Market Trend: The online interior design space grew by over 40% year-over-year during the pandemic, which made Modsy an attractive investment.

Could Modsy’s Model Work for Your AI Interior Design App?

If you’re considering building a similar app, here are some insights to help you shape your business model:

• Freemium Tiers: Offer basic design features for free to attract users, then upsell premium features like one-on-one designer consultations or advanced customization options.
• E-Commerce Integrations: Partner with furniture retailers to earn affiliate revenue from product recommendations, boosting your revenue stream.
• B2B Services: Consider offering virtual staging to real estate agents or product placement to furniture brands for additional revenue.

Development Steps for an AI Interior Design App Like Modsy

Here are the steps to develop an AI interior design app like Modsy,

1. Market Research & Competitor Analysis

Begin by conducting thorough research to understand the interior design market, target user demographics, and current pain points in virtual design experiences. Study leading platforms like Modsy, Havenly, and DecorMatters to assess their strengths and limitations. 

2. Backend Development

Build a scalable and secure backend architecture to handle core app operations. This includes managing user profiles, processing image data, storing 3D designs, running AI algorithms, and supporting e-commerce functionality. Technologies like Node.js with Express or Django with PostgreSQL are effective for ensuring performance, scalability, and smooth API integration.

3. Define Core Features & Use Cases

Once you’ve understood the market, clearly define the core features your app will offer. These might include room scanning through photos, style quizzes, 3D room modeling, real-time design customization, AI-generated furniture suggestions, AR/VR previews, and integrated shopping. 

4. UI/UX Design & Wireframing

Designing a seamless user interface and experience is key to ensuring users can easily navigate the app. Create wireframes and interactive prototypes that map out the user journey, from uploading a photo to exploring a finished 3D room design. 

5. 3D Rendering Engine Integration

To deliver a visually rich experience, integrate a robust 3D rendering engine such as Unity, Unreal Engine, or WebGL. This engine should be capable of generating photorealistic room visuals, complete with accurate lighting, shadows, textures, and spatial measurements. 

6. AI/ML Model Development

Develop advanced AI and machine learning models to automate style recognition, furniture recommendations, and layout optimization. These models can analyze quiz responses, user-uploaded images, and room dimensions to suggest tailored interior styles. 

7. Furniture & Retailer API Integration

To make the app a one-stop design and shopping solution, integrate APIs from major furniture retailers such as Wayfair, Target, and Crate & Barrel. These APIs will fetch real-time product details, prices, availability, and images. 

9. Testing, Launch & Optimization

Before launching, conduct rigorous testing across various devices and user scenarios. Validate the accuracy of AI suggestions, the realism of 3D renderings, and the responsiveness of UI/UX. 

Cost of Developing an AI Interior Design App Like Modsy

The cost of developing an AI interior design app like Modsy varies. It depends on factors like the technology used, the features included, and how scalable the app needs to be. Understanding these components is crucial before starting the project.

Cost Component	Description	Estimated Cost Range ($)
Research and Planning	Market research, feature definition, and technical specifications	2,000 – 5,000
UI/UX Design	Creating wireframes, mockups, and a user-friendly interface	3,000 – 10,000
Frontend Development	Building the user interface for iOS, Android, or web	5,000 – 20,000 (per platform)
Backend Development	Developing the server-side logic, APIs, and database	5,000 – 20,000
AI and Machine Learning	AI models for style recognition, furniture placement, and recommendations	10,000 – 40,000
App Features	Additional functionalities affecting cost
– 2D Visualization	Basic room visualization	2,000 – 5,000
– 3D Visualization	Advanced 3D room rendering	10,000 – 25,000
– AR Integration	Augmented reality for interactive room design	5,000 – 15,000
– E-commerce Integration	Integration with furniture stores for purchasing	3,000 – 8,000
Testing & Quality Assurance	Functional, usability, and performance testing	3,000 – 10,000
Data Acquisition	Gathering and processing data for AI training	2,000 – 8,000

Cost Estimates: $10,000 – $100,000

Factors Affecting the Cost of Developing an Interior Design App Like Modsy

Building an AI-powered interior design app like Modsy comes with unique challenges that drive up costs. It requires expertise in areas like 3D modeling, AI algorithms, and AR integration. Here’s a quick breakdown of the key cost factors:

3D Asset Creation and Management

Creating high-quality 3D models and realistic renderings of furniture and décor can be costly. This requires skilled designers and powerful software.

AI Model Training Data

Gathering and labeling a large, diverse dataset for training AI models is essential. The better the data, the more accurate the AI becomes, but it’s time-consuming and expensive.

AI Algorithm Complexity

Developing algorithms for tasks like room dimension estimation, furniture placement, and style recommendations requires expert AI engineers and computational resources.

AR Integration Precision

Integrating accurate and realistic AR for virtual furniture placement in real-world spaces requires advanced technology in computer vision and sensor fusion, increasing the development cost.

How Modsy Uses AI in their App?

Here’s how Modsy uses AI in their application, 

1. AI-powered room scanning & 3D Modeling

The journey begins with users uploading photos of their rooms. Modsy’s AI uses cutting-edge computer vision and spatial recognition technology to:

• Detect room dimensions: Automatically detects and measures the walls, windows, doors, and other architectural features.
• Create a precise 3D replica: Once the dimensions are identified, the AI creates an accurate 3D model of the room, virtually removing existing furniture.
• Identify existing furniture: If the user has furniture they want to keep, the AI identifies these items and integrates them into the design concept.

This streamlined process eliminates the need for time-consuming manual measurements, making it easier and faster to visualize a space’s potential.

2. Smart Style Recommendations

After completing a quick style quiz, Modsy’s AI gets to work.

• Analyze preferences: The AI analyzes the user’s answers about color preferences, furniture styles, and budget to understand their taste and lifestyle.
• Match decor trends: The system taps into the latest decor trends and suggests designs that align with the user’s style.
• Generate mood boards: It then generates mood boards with various themes (e.g., modern, bohemian, minimalist) so users can see different visual directions for their space.

The AI is constantly learning from millions of data points, so it can make highly accurate style recommendations, helping users discover a look they’ll love.

3. Virtual Furniture Placement & Space Planning

Modsy’s AI also excels in space planning. Using augmented reality and machine learning, it:

• Recommends layouts: Based on the room’s dimensions and user preferences, the best possible furniture layout is suggested.
• Simulates fit and flow: The AI simulates how different furniture pieces fit in the space, ensuring that everything fits together perfectly without overcrowding or awkward spacing.
• Real-time adjustments: Users can easily swap furniture or adjust layouts in the 3D viewer. If something isn’t quite right, the AI instantly updates the design.

This helps users avoid costly mistakes by letting them visualize how furniture will actually look and function in their space before making any purchases.

4. AI-Curated Product Suggestions

One of Modsy’s standout features is how it simplifies the shopping process:

• Scan thousands of products: Modsy’s AI scans a vast catalog of products from major retailers like Wayfair, West Elm, and Target, finding the best options based on the user’s style and budget.
• Suggest alternatives: If an item is out of stock or over budget, the AI automatically suggests alternatives that align with the original vision.
• Track pricing trends: The AI keeps an eye on pricing trends and can even highlight special deals or sales, ensuring users get the best value for their money.

Users are provided with a personalized shopping list that’s fully integrated into the app, making it easy to purchase everything in just a few clicks.

5. Human + AI Collaboration for Refined Designs

While AI handles the heavy lifting of generating layouts, recommendations, and suggestions, Modsy’s human designers are still crucial in refining the final design:

• Polish AI-generated layouts: The designers ensure the AI-generated layouts are not just functional but also aesthetically pleasing. They adjust designs for practical flow and proportion.
• Expert revisions: Designers offer additional insights, making revisions based on user feedback to ensure the design works well with their lifestyle.
• Attention to detail: Lighting, textures, and proportions are carefully considered by the designers, ensuring the final render looks realistic and cohesive.

Conclusion 

Building an AI interior design app like Modsy can change the way people think about home styling. By using AI, machine learning, and 3D modeling, businesses can offer personalized design recommendations at scale. This not only saves time and money but also makes design accessible to a wider audience. For businesses, a similar app can create several ways to earn. You could use subscription models, in-app purchases, or even partnerships with furniture brands. 

Looking to Develop an AI Interior Design App Like Modsy?

At Idea Usher, we specialize in bringing your vision to life with cutting-edge AI technology and user-friendly design. With over 500,000 hours of coding experience and a team of ex-MAANG/FAANG developers, we ensure top-notch quality and performance for your app. Whether you’re looking to create personalized design recommendations or offer 3D visualizations, we’ve got you covered. 

Check out our latest projects to see the kind of work we can do for you, and let’s build something amazing together!

FAQs

Q1: How to develop an AI interior design app?

A1: To develop an AI interior design app, you start by defining the app’s core features, such as personalized design suggestions, 3D modeling, and virtual furniture placement. After that, choose the right technologies like AI and machine learning, and work with experienced developers to bring the concept to life. Lastly, ensure the app is easy to use and integrates smoothly with e-commerce platforms or furniture brands.

Q2: What is the cost of developing an AI interior design app?

A2: The cost of developing an AI interior design app depends on the complexity of the features you want to include. Elements like design, AI integration, platform choice, and development time all play a role in determining the overall price. It’s best to work with a development team to get a more accurate estimate based on your specific needs.

Q3: What are the features of an AI interior design app?

A3: The main features of an AI interior design app typically include personalized design suggestions, 3D visualization, augmented reality for virtual furniture placement, style quizzes to understand user preferences, and integration with furniture e-commerce platforms. The idea is to give users a comprehensive and interactive way to design their spaces.

Q4: How does an AI interior design app make money?

A4: An AI interior design app can make money through several methods. This might include offering premium features via subscriptions, charging for virtual consultations or expert advice, partnering with furniture brands for affiliate sales, and providing in-app purchases for additional design tools or templates.