LegalZoom vs. ZenBusiness : Which One Should you Pick?

It’s easy to see that incorporating your business to protect your personal assets is just sensible, but it’s not that easy to pick the best incorporation outfit that can do this for you. For many, the choice boils down to the two heavyweights in the incorporation services industry: the ever-popular LegalZoom, or the highly regarded ZenBusiness

Picking one over another isn’t going to be easy, and there’s really no definitive answer. It’s possible that for one person, LegalZoom may be the better option but ZenBusiness may be the best choice for another. 

So, let’s take a closer look at what’s likely to suit your needs when it’s time for you to incorporate your business. We’ll compare them on various crucial factors that you’ll need to take into account before you make your decision. 

The Incorporation Packages: What You Get for What You Pay

For many small business owners, budgets are tight so that you’ll probably appreciate a cost-effective solution to your problem. You may be will to pay a little bit more for superior services, but the extras you get better be worth the money. 

With that in mind, here are the packages offered by these 2 incorporation services:

LegalZoom vs. ZenBusiness Comparison

LegalZoom ZenBusiness
Economy: $99

  • Check the availability of the corporation name 
  • Prepare articles of organization
  • Create financial account authorization letter
  • File the documents with the state
  • Provide a guide on what to do after incorporating
Starter: $39

  • Provide registered agent services for a year
  • Prepare and file for corporation or LLC
  • Confirm name business name availability
  • Customer support via email, chat, or phone
  • Online document service, for viewing and printing documents and tracking the formation progress
  • Special business credit card offer from Divvy
  • Statement of organizer, which some banks may require
  • Quick licensed CPA assessment of your bookkeeping and tax needs
  • Online marketing tips
  • Operating agreement or bylaws
  • Matches what you spend on Google Ads for the first month (up to $150)
Standard: $329

This includes all the Economy services, plus:

  • Create 20 company membership certificates
  • Create binder and customized company seal with your business name 
Pro: $149

All the Starter features are included, plus:

  • Faster filing speed
  • Banking resolution template
  • Employee ID number
  • “Worry-free” compliance service
Express Gold: $349

You get all the Standard services, plus:

  • Faster formation (7 to 10 business days, instead of 30 business days)
  • Express shipping for business documents
Premium: $249

  • “Rush” filing speed (you’re placed at the head of the line)
  • Business website
  • Business domain name
  • Domain name privacy
  • Business email address

ZenBusiness Official Website

 

Overall Pricing and Value

It really doesn’t take long for you to realize that ZenBusiness simply offers a better deal. You pay a lot less with their Starter package, and yet you get a lot more than even the expensive Standard package from LegalZoom. 

The most notable advantage here is that ZenBusiness offers the required registered agent services, for an entire year. You’re paying for the complete package for just $39.

With LegalZoom, this registered agent service is an expensive option. It will cost you $299 a year, and that’s separate from their incorporation services. So, even if you get the cheap (relatively speaking) $99 Economy package, you have to add the $299 per year because registered agent services are required

That means you end up paying $398 for the first year. Do the math—you’re paying 10 times more for LegalZoom than you are with ZenBusiness! 

Company Track Record & Experience

With such a huge disparity between the cost effectiveness of the packages from these 2 outfits, how can LegalZoom stay in business? In fact, they’re not just surviving. They’re actually considered the most popular brand in the incorporation services industry. 

How can this be with these outrageous prices?

One of the main reasons is that they’ve been around for a long time now. They’re one of the oldest brands in the industry, as they’ve been doing this service since 1999. They’ve satisfied quite a few business owners over the years, with more than 4 million customers served. They’ve assisted in the incorporation of more than a million businesses. 

It’s only natural that these people recommend the LegalZoom service to the other people they know who are incorporating. They’re actually quite professional, and they know their job. They ought to, since they have the experience. 

On the other hand, ZenBusiness is comparatively a newcomer in the industry. They’ve only been around since 2015. They haven’t even yet to reach their 1-millionth customer, and that’s projected to happen by maybe 2025. 

Considering its newness, ZenBusiness has built an astonishing reputation for its brand. It has garnered thousands of online customer reviews, and the vast majority of them give ZenBusiness perfect scores. In comparison, the reviews for LegalZoom are decidedly mixed in their assessments. There are just as many “poor” scores the reviews as there are “perfect” scores. 

 

Also, plenty of industry experts consider ZenBusiness as a terrific option. These experts have certainly noted that ZenBusiness offers a lot for relatively little money. 

Ease of Use

Both LegalZoom and ZenBusiness offer more convenient legal services online than do traditional law firms that used to provide these incorporation services. In most cases, all you have to do is to go to their websites, follow the instructions, and the incorporation will handle the rest. 

So, how easy are these websites to use?

With LegalZoom, everything’s quite easy. The directions are clear, and you’re guided along the way. It’s another one of the reasons why it’s a popular option. 

However, not everything on the site seems like it’s for your benefit. It’s as if the site was designed to make it more efficient at getting you to spend money, than it’s made to actually meet your incorporation needs. 

The first step already takes an inordinately long amount of time. You’re required to first enter your personal info, and then you pick whether you’re setting up a corporation or an LLC. 

At this point, you’d expect to then pick the incorporation package you want, right? But that’s not how it goes. Instead, you get offers to rather pricey optional add-ons first. Only when you’ve said “yes” or “no” to these offers (at least these offers come with explanations as to why you might want or need them) will you then get to pick the incorporation package you want. 

With ZenBusiness, using the website is also easy. Things are explained clearly, and you’ll know what to do without having to query customer support about each step of the process. 

The first step deals with the formation service form, which takes only a few minutes because of the clear instructions. You choose between LLC and corporation, then you pick the specific package. You then enter some more info about your business, and that’s that. The rest of the process will be in the hands of ZenBusiness. 

Sure, you do get some discreet upsell offers afterwards, but at least you can ignore them if you want. 

Customer Service

Even if the websites offer clear instructions and explanations for services, sooner or later you’ll have questions for the customer support. So, how does each brand do when you’re bugging them for info?

With LegalZoom, your best bet is to call them up. When they answer the phone, ask them your questions and they will provide the answer with lots of helpful details. They will then lay out your various options with explanations. Of course, these options may also include upsells, but are you surprised at this point?

After the agent (US-based) answers your questions, the agent then gives you a follow-up email message with their direct extension. That way, you can contact that same agent directly if you have more questions along the way. 

The phone route is much better than just sending them an email with your questions. They sure take their time answering emails. In some cases, it may even take an entire week before you get a reply. And even then, this reply is most likely an automated message that doesn’t really answer your questions satisfactorily. 

The email reply does come with their phone customer support number, and it’s really a good idea that you take the hint and call them instead. 

In contrast, ZenBusiness customer support is among the very best in the industry. While other incorporation services offer support through email and phone, with ZenBusiness you can also use the chat service online. 

Send them an email, and you probably won’t have to wait more than 24 hours before you get your reply. In fact, send them an email in the morning and the reply will arrive that same day. The email is good, with helpful answers. In fact, you can say the same thing for the replies you get via chat and phone. 

With chat and phone calls, it only takes a few minutes before someone (who knows what they’re talking about) takes your call. 

Speed of Formation

How long does it take to finish the incorporation process? Both outfits will tell you that the speed of the process depends largely on the state. You can’t blame them if overworked state employees take their time. 

With LegalZoom, you’ll get an estimate as to how long the process will take. On the whole, they take as long as the other brands do if you go with their Economy package. That means waiting for a bit—it may even take 30 business days, which translates to 6 weeks. 

You may call up customer support for more accurate estimates along the way. But keep in mind that your incorporation request gets into a line, and LegalZoom is very popular. It’s “first come, first, served”. 

If you opt for the more expensive packages or get the faster process add-on, the process shortens to perhaps 7 to 10 business days as you’re set at the head of the line. 

With ZenBusiness, the completion time is similar. It’s just that they have fewer customers, so the line is shorter. The normal time is 3 to 4 weeks, but you then get things done in either 1 or 2 weeks (expedited) or even 3 to 5 business days for the rush service. 

What are the most common reasons why you’d want to pick LegalZoom?

Here are the frequently cited reasons:

  • They’ve been around a long time, so they know what they’re doing. 
  • It’s the most popular brand, so they must be doing something right. 
  • They charge premium prices for their services, so they must be really good. 

Why would you want to go with ZenBusiness?

The main reason is that you pay a lot less and still get a lot more. That free for a year registered agent service is especially great, since it’s a requirement. You get that as part of the $39 package. In contrast, none of the LegalZoom packages have this feature. It’s a separate service that will cost you an extra $299 a year.   

Basically, ZenBusiness is the most cost-effective choice. But you should also take into account the following:

  • Just about all their customers praise the services they get. 
  • The customer support is a bit better. 
  • Their website doesn’t offer add-ons first. 
  • ZenBusiness does things a bit faster, because they don’t have as many customers. 

Conclusion

The choice you make depends entirely on what you need. For some people, it’s about getting the most for their money. That makes ZenBusiness the obvious choice. 

But others may feel safer with the longer business history of LegalZoom, and the fact that the brand is the most popular option in the industry also says a lot. 

Either way, whether you go with LegalZoom or ZenBusiness, you can be pretty sure that the entire incorporation process will be done right—and that’s the most crucial thing!

 

 

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