Company Formation

BetterLegal vs LegalZoom (2023)

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Starting a business can be an exciting endeavor, but navigating the complexities of legal paperwork and compliance requirements can quickly become overwhelming.

Entrepreneurs and small business owners often turn to online legal service providers like BetterLegal and LegalZoom for their business formation requirements. These platforms offer a range of services designed to simplify the process, saving time and resources for aspiring business owners.

In this article, we explore the offerings of BetterLegal and LegalZoom, examining their business formation services to help you make an informed decision. While both platforms have gained recognition in the industry, it’s essential to understand the unique features and benefits they bring to the table.

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Comparison Chart

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Product NameBetterLegalLegalZoom
BizFilings vs LegalZoom for LLC
WebsiteStart HereStart Here
PricingTransparent pricing with no hidden feesTiered pricing with various package options
Business Types CoveredLLC
Corporation
LLC
Corporation
Nonprofit
DBA
Registered AgentAdd-on featureAdd-on feature
EINIncludedIncluded
Turnaround TimeTwo daysSeven to 10 days
User ExperienceUser-friendly website and streamlined processesUser-friendly website with step-by-step guidance
Legal ExpertiseProvides access to legal professionalsOffers legal advice from independent attorneys

Company Overview

BetterLegal and LegalZoom are prominent players in the online business formation industry, offering entrepreneurs and small business owners efficient solutions to streamline the process of establishing their companies.

BetterLegal, founded in 2016, has quickly gained recognition for its transparent pricing and user-friendly platform. The company focuses on providing essential business formation services, including the formation of LLCs, corporations, and registered agent services. With a growing presence in the market, BetterLegal aims to simplify the complex legal paperwork and compliance requirements, catering to the needs of startups and small businesses.

LegalZoom, on the other hand, has been a pioneer in the industry since its establishment in 1999. As one of the most recognizable names in online legal services, LegalZoom offers a wide range of services beyond business formation, including legal documents, trademark registration, and estate plans. With a large customer base and extensive experience, LegalZoom has become synonymous with accessible legal services for businesses of all sizes.

Business Formation

When it comes to business formation services, BetterLegal offers a clear and concise approach. They only provide two distinct formation packages: one designed for LLCs and another tailored for corporations.

It’s worth noting that the company explicitly mentions the features included in these packages. However, registered agent and state compliance services are not part of the listed features. Instead, BetterLegal offers these services separately through monthly or yearly subscription options.

In contrast, LegalZoom covers a broader range of business entities, including LLCs, corporations, DBAs, and nonprofits. LegalZoom also presents different business plans for each type of formation following a tiered pricing model. Each plan caters to different business needs and budgets, providing a range of features and benefits.

Additionally, they offer various supplementary features such as annual reports, business licenses, and registered agents, which are available for purchase separately.

Below, we make a comprehensive comparison of BetterLegal and LegalZoom’s LLC and Corporation formation service. We also list the plans and pricing for LegalZoom’s packages for DBAs and nonprofits.

Plans and Pricing

BetterLegal

  • LLC Formation — $299 + state filing fees
  • Corporation Formation — $299 + state filing fees

Both the LLC Formation and Corporation Formation packages provide essential components for business formation: filing type, an EIN, and a banking resolution. With the LLC Formation plan, you also get an operating agreement while with the Corporation Formation package, you’re provided a banking resolution instead.

In addition, BetterLegal adds free perks including a website, business checking service, and tax analysis for both formation services.

Having a registered agent is a requirement for LLCs, and BetterLegal offers this service at an affordable rate. For just $10 per month or a discounted rate of $90 per year, you can ensure your LLC has a registered agent in place. BetterLegal also provides ongoing state compliance services at the same price, making it convenient and cost-effective to maintain compliance with state regulations.

LegalZoom

LLC Formation

  • Basic — $0 + state filing fees
  • Pro — $249 + state filing fees
  • Premium — $279 + state filing fees

Here’s a brief overview of what each plan includes:

  1. Basic Plan: Covers essentials such as name check service, preparation, and filing of articles of organization, and a digital welcome packet. State filing fees apply.
  2. Pro Plan: Includes all Basic plan features, plus an operating agreement, EIN, business licenses, and phone consultations with specialists in business insurance and taxes.
  3. Premium Plan: Offers everything in the Basic and Pro plans, along with 30-minute legal consultations with an attorney, access to customizable legal forms, copyright registration, and document revisions within the first 30 days.

It’s important to highlight that LegalZoom’s LLC formation packages do not include a registered agent service. This service needs to be purchased separately at a cost of $299 per year.

Corporation Formation

  • Economy — $149 + state filing fees
  • Standard — $329 + state filing fees
  • Express Gold — $349 + state filing fees

Here’s a brief overview of what each plan includes:

  1. Economy Plan: Includes name search, business entity filing, small business consultation, digital welcome packet, 7 days a week customer support, and a customizable website powered by Wix.
  2. Standard Plan: Includes all Economy Plan features, plus a founder’s kit and personalized notebook.
  3. Express Gold Plan: Offers everything in the Standard Plan but with expedited processing (1 to 2 business days) and express shipping.

Nonprofit Formation

  • Economy — $99 + state filing fees
  • Standard — $239 + state filing fees
  • Express Gold — $359 + state filing fees

DBA Formation

  • Standard — $99 + state filing fees
  • Premium — $119 + state filing fees

Ease of Use and Service

When it comes to business formation, both BetterLegal and LegalZoom offer user-friendly online platforms and dashboards to simplify the process.

BetterLegal prides itself on providing a seamless user experience. Their online platform is designed to be intuitive and straightforward, allowing users to navigate effortlessly through the business formation process.

One standout feature is their impressive turnaround time, which is one of the fastest in the industry. While many online legal services may take weeks to process and get your business up and running, BetterLegal stands out with its impressive same-day filing option for business formations. This means you can get your LLC or corporation up and running swiftly.

LegalZoom’s online platform offers comprehensive business formation services; however, it can initially feel overwhelming due to the wide range of business entities they cover. To address this, LegalZoom provides a helpful questionnaire that guides users in determining the right business type for their needs.

The turnaround time for business formation services can vary based on the package you choose. Basic packages usually adhere to standard processing times, ensuring timely completion of the necessary procedures. However, if you’re in need of expedited services, LegalZoom’s premium packages are designed to offer faster business formation, allowing you to accelerate the process

Customer Support

BetterLegal offers responsive customer support via phone, live chat, email, and an online form. Their support team provides assistance without sales pitches and maintains a reasonably fast response time.

LegalZoom, on the other hand, is known for excellent customer service, but the level of support and response time depends on the chosen plan. Higher-tiered business formation packages receive prioritized support and greater availability.

Verdict

Choosing between BetterLegal and LegalZoom depends on two factors: your budget and your specific business needs. While both providers offer LLC and corporation formation services, LegalZoom has the advantage of also covering nonprofits and DBAs. If you’re seeking to form these types of business entities, LegalZoom is the clear choice.

For those interested in forming an LLC or corporation, BetterLegal may initially appear more expensive. However, a closer examination of BetterLegal’s features reveals formation packages that rival LegalZoom’s premium plans. BetterLegal includes additional free perks, and its registered agent and compliance services are notably more affordable compared to LegalZoom.

If you’re a larger business with a flexible budget, LegalZoom may be more appealing. However, for small to mid-sized organizations operating on a tighter budget, BetterLegal’s LLC and corporation formation services offer a better value proposition.

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