As an entrepreneur looking to open a business, you can quickly become overwhelmed with the amount of paperwork you need to stay on top of in order to keep your business running.
If you need to incorporate your business or form an LLC, there are several companies out there that can do the job. However, LegalZoom and ZenBusiness are two of the top online companies that thousands of customers have used over the years.
It’s important to compare which company is better for your business in order to get the services you need. We compared six key considerations in choosing the better LLC service and incorporation service provider for you. We also looked at the pros and cons of both companies so you can make an informed decision.
Let’s start with a quick overview of each company.
LegalZoom is one of the best-known service providers compared to its competitors. They have been around since 1999 and have served thousands of customers. They also have excellent customer service hours to answer any questions you may have Monday through Saturday.
However, LegalZoom’s packages priced much higher than ZenBusiness with fewer features included. Their ordering process is also more confusing as they require you to enter your business information before showing you the total price. If you’re simply looking to compare prices, this can be highly inconvenient.
They also do not provide a registered service agent like other services, which is a big drawback for LegalZoom. An agent can be added on, however, for a fee.
Their first package, Economy, starts at $149, which includes name availability, filing documents with the state, a “Next Steps” guidebook, and a free trial at 1-800-Accountant. It is great for business owners just looking for the bare minimum help for online incorporation.
The Standard package is $329 and adds customized certificates and an organization kit for your documents that bear your seal and company name. The top-tier package goes for $349, and its main draw is its expedited services.
ZenBusiness is our choice for the better LLC and incorporation service. Their packages are much more affordable compared to their competitors, starting at just $39. They offer a variety of excellent features that LegalZoom does not.
Their online customer reviews are excellent as well, and they have a quicker response rate from their customer service representatives. All of these factors are important to consider for your business, and ZenBusiness definitely puts the customer first.
However, they have only been around since 2015 and lack some of the industry experience that LegalZoom carries. They also have shorter hours for their customer service, meaning they are only available during the weekdays.
Despite their cons, their low-cost packages, quick services, incredible features, and outstanding customer feedback make ZenBusiness the best LLC and incorporation service online.
Their Starter package goes for $39 and includes the basics of incorporation along with a registered agent service. The Pro package is $149 and comes with more features such as a banking resolution, their Worry-Free Guarantee, and a federal tax ID number (EIN). Finally, their Premium package is $249 and adds a domain name package and a website.
LegalZoom: With a high customer volume, LegalZoom is a popular service provider. Their cheapest incorporation package is $149, not including state fees, which includes some significant features. However, they do not include a registered agent in any of their packages. Adding one requires another fee of $159-299.
Overall, LegalZoom does not offer a better value for their customers because of their higher prices. The number of upsells they offer can also be overwhelming; you may end up with a higher-than-expected final price when you finally see your total amount. You can easily spend much more on LegalZoom because of the extra add-ons and third-party offers.
Some of the optional add-ons they offer are essential documents such as bylaws and resolutions, EIN, and business licenses for $249, tax services through Affordable Tax for $320 a year, legal assistance for another $320 a year, and options for compliance, which is an additional $280 a year.
ZenBusiness: This is the only service provider that offers an incorporation package for $39. It is the lowest price for nationwide service and includes a registered agent and a free CPA assessment. The package also includes full prep and filing of your legal documents, which can save you a lot of extra work doing it on your own. It is perfect for entrepreneurs who are on a budget, need the incorporation basics, and would like the assistance of a registered agent.
The middle Pro package is $149 and adds an annual report service, a federal tax ID number (EIN), a banking resolution, and compliance monitoring and management. With the compliance monitoring service, they prepare and file the annual report for your business and include the filing of two amendments per year.
With the basic plan, you can include several add-ons. However, many of those additions are included in the Pro plan for just $110 more. The registered agent service is also free only for the first year with the Starter plan. For the following years, that service has a price point of $119 per year.
With a better value for the price you pay, ZenBusiness offers a much stronger incentive than LegalZoom. The $39 incorporation package is an unbeatable price for the number of features you receive compared to the $149 basic package from LegalZoom.
The Pro package from ZenBusiness comes with many more advanced features, which LegalZoom still lacks, including a registered agent. The expensive add-ons from LegalZoom can confuse new business owners, while ZenBusiness focuses on providing more of what the customer needs at a better price.
That consideration, alongside their lower-priced packages, make ZenBusiness the winner in this category.
LegalZoom: LegalZoom’s basic Economy plan starts at $149 and comes with a handful of features. This package includes name availability check, filing documents with the state, articles of incorporation, a “Next Steps” guide, a free trial at 1-800-Accountant, and lifetime customer support. It is excellent for business owners simply looking for the minimum help starting their online corporation.
Their Standard and Deluxe packages offer slightly more. The Standard package is $329 and adds on 20 customized certificates and a deluxe organizer that bears your seal and company name to carry your essential documents.
The last package, the Express Gold, goes for $349, and the main feature you pay for is the rush service and faster turnaround speed. It’s great for entrepreneurs who require an expedited registration for their corporation. There are several other features, such as a registered agent, which you can add on for an extra fee regardless of which plan you choose.
ZenBusiness: Starting at $39 a year plus state fees, ZenBusiness offers affordable packages with a variety of excellent features. They include services from a registered agent, a CPA Assessment, and an Operating Agreement. The CPA Assessment helps you refinance your company and recommend the right CPA to meet your specific needs.
Other benefits that are included in their middle Pro package are the expedited filing service, an Employer Identification Number (EIN), and a Worry-Free Compliance Guarantee. The Worry-Free Compliance includes documents being submitted for you, a business filing service, two free changes to your filings per year, and a free consultation with an accountant. This package is perfect for business owners who want more advanced features to help operate their business.
Their highest-tiered plan, the Premium package, costs $249 per year for extra services from third-party partnerships. It includes registration for a domain name, domain-name privacy to keep your information private, an email address, and a website. However, this option does not have as great a value as the Starter and Pro packages for the price.
For the price value, ZenBusiness has a solid win in this category because of their variety of features in their much cheaper packages. They have add-on features like LegalZoom, but you can receive more advanced options for the same or lower price at ZenBusiness.
Having a registered agent available even in their Starter package makes an enormous difference as well, which LegalZoom only offers for an extra fee.
LegalZoom: Customer service is available from LegalZoom through phone or email. When contacting them by email, they can take up to a week to respond. When they do finally respond, their email is often generic and does not offer any specific help with your question. Though their online support may not address specific issues, calling their support number will give you a better experience.
Their phone representatives are much more helpful and easy to contact. They can go into detail in answering your questions and provide different solutions, which can make all the difference for business owners. However, customer reviews are mixed for LegalZoom, with about the same number of five-star reviews as one-star reviews.
Their customer service hours are longer than most of their competitors: they are available to help Monday through Friday from 8 AM to 10 PM EST and Saturdays, 10 AM to 7 PM EST.
ZenBusiness: With hundreds of positive reviews online, ZenBusiness stands out with excellent customer services. Their department is available through email, phone, or the chatbox on their website. They give timely responses within one business day with friendly and thorough information to help you with any problems or issues.
Some of their responses can be seen on the Better Business Bureau website. All of their representatives seem to know the same accurate information to answer all of your questions. Most of their online customer reviews are highly positive, boosting their reputation as a reliable incorporation and LLC service provider.
Their customer service representatives are only available during the weekdays, Monday through Friday, from 9 AM to 7 PM EST.
LegalZoom offers extended customer service hours, which makes them stand out from their competitors. Their email service is not the most helpful, but their phone support offers more specific and detailed assistance. However, ZenBusiness offers speedy and thorough assistance in a variety of ways. They also have thousands of glowing reviews from their customers online.
The timely and comprehensive responses from ZenBusiness can make a big difference for new business owners in answering urgent questions, making them the winner in this category.
LegalZoom: Unlike many of their competitors, LegalZoom takes a different approach to the ordering process. It is designed to entice you to spend more money than you might have planned.
The first step in the process is to enter your personal information before you can see any of the packages. Then you need to go through a variety of pricey upsells that can exceed $1,000 before you are finally led to choose your package option.
The form itself is easy to understand, but each of the additional features advertised is worded to explain precisely why you need it. Seeing those additions before the actual package options make it seem logical to add it to your order despite its higher price. It is a highly involved process that can lead to higher total costs in the end.
ZenBusiness: The order form from ZenBusiness is quick and easy to fill out with straightforward instructions. It is made to help people starting a new business to save their energy and time without dealing with a confusing formation process. Many other competing providers make ordering a hassle, but ZenBusiness keeps it simple.
You first select the package you would like to purchase, and then provide basic information about you and your company. They offer some upsells before you complete your purchase, but they take care of the rest once you finish. There are some distracting third-party offers throughout the ordering form, but overall you know what you are paying for upfront.
For many entrepreneurs, filling out forms and paperwork can be a hassle, so a formation service that is easy to use can save a lot of time and headache.
With simple instructions and a quick ordering process, ZenBusiness is the clear winner for us here. LegalZoom seems to have designed their formation process to entice you to spend much more than you expected, while ZenBusiness puts the customer’s needs first.
Both do offer upsells and third-party offers as you order, but the amount of additional features LegalZoom offers is overwhelming and expensive. Their ordering process is also much more convoluted than ZenBusiness.
LegalZoom: While many other service providers calculate their turnaround times in each state, LegalZoom does it differently. They estimate their turnaround times by package rather than by the individual state processing speeds.
Their most economical package has a 6-week turnaround time, while their most expensive packages take about 7-10 days to be completed. The top-tier Express Gold package includes a two-day delivery of your completed official documents.
Their turnaround rate is similar to many other LLC and incorporation services online. However, these times can still vary by state.
ZenBusiness: Like LegalZoom, they base their turnaround times on the type of package you select from them. Their Starter package generally has a 3-4-week turnaround, while their Pro package takes about 1-2 weeks to be completed.
At the top, their Premium package only takes 3-5 days for processing. However, these estimates can vary depending on the state, so you can contact a ZenBusiness representative to get an exact estimate of the turnaround time.
Though it is ideal for formation service providers to base their turnaround speeds on individual states, both companies base their rates on the amount of money you spend on their packages.
With much quicker rates for both their lower-tier and top-tier packages, ZenBusiness beats LegalZoom in this category. LegalZoom still offers decent delivery times, but ZenBusiness allows for quicker processing overall. However, both companies may have varying turnaround rates depending on the state processing speed.
LegalZoom: LegalZoom has been serving customers since 1999, and they have had over 3.6 million clients from then. They have helped open over 1 million businesses over the years using their business formation services, among others. LegalZoom has had more customers than most competitors out there, giving them an incredible track record.
Their customer reviews, however, are not always very positive. Customers seem to either love the services LegalZoom provides or feel strongly disappointed. They have relatively the same number of five-star reviews as one-star reviews online on most third-party websites. Their average score falls short of some of the other incorporation service providers.
ZenBusiness: Started in Austin, Texas, ZenBusiness has been around since 2015. Over the years, they have been growing steadily and have already served thousands of customers. Their use of technology, such as automation, allows them to offer lower rates and build a stronger reputation in the business formation industry.
In just a few short years, ZenBusiness has already helped open thousands of enterprises, and their goal for the next five years is to form over one million new businesses. Though they may lack industry experience, their thousands of clients offer glowingly positive reviews online, showing that ZenBusiness is making an impression despite how new they are.
Though ZenBusiness has excellent reviews from customers, LegalZoom has a high level of experience on their track record. We call it a tie for this category since both LegalZoom and ZenBusiness have different types of track records.
LegalZoom has served more customers than ZenBusiness over the years and has helped open over a million businesses. ZenBusiness, however, seems to be growing strong with its customer network and high reviews. You may feel more drawn to one over the other, depending on whether you prefer customer reviews or experience.
ZenBusiness is the resounding winner in this comparison with LegalZoom. The price of their incorporation and LLC packages, along with the features you receive, come at an unbeatable value. LegalZoom does have some advantages, such as their long company track record, but in all other categories, ZenBusiness dominated.
LegalZoom is a well-known and popular company because they provide professional and reliable services. If you are looking for basic formation help, they may be the right choice for you.
However, ZenBusiness is one of the best options available because they provide more affordable assistance and faster formation processing overall.
Start a Rank and Rent Business
Copyright © 2023 DFYBiz.com. All Rights Reserved.