Do you need to incorporate a business but you can’t figure out which incorporation service has your best interests in mind?
ZenBusiness and LegalZoom are two of the top companies online and they each have their own pros and cons when compared to each other.
This comparison guide takes a look at the five key factors you need to consider when deciding which service is the better fit for your business. Let’s find out whether LegalZoom or ZenBusiness is the right choice to form your company.
Key Comparison Points
In our review and comparison of each online incorporation service, we performed a “stress test” on each based on 5 key factors:
- Compared pricing and features to determine overall value.
- Researched their track record.
- Assessed the quality of customer service.
- Tested their ordering process and service’s ease of use.
- Reviewed the turnaround times for incorporating online.
That said, as you’ll see in our ZenBusiness vs LegalZoom comparison of these five key factors, ZenBusiness wins out as the better incorporation service and LLC service. They are $100 more affordable and have better features and more than 10,000 positive customer reviews online.
Overall Pricing and Value
ZenBusiness: Their best attribute in this area is the fact that their incorporation service costs just $49. Not only is this one of the lowest prices we’re aware of for nationwide incorporation service, but it includes annual report service, an accounting assessment, and some sample business documents. Their $299 package is also intriguing because it adds several valuable features: custom corporate bylaws and a business website package.
LegalZoom: LegalZoom is incredibly popular, as they have a customer volume in the millions, and they also have tremendous brand power due to their sizable advertising budget. However, that doesn’t necessarily mean that they provide a more valuable service than their competitors. Their cheapest incorporation package has a $149 price point, and it includes no noteworthy advanced features. They also don’t include registered agent service in any of their packages, and they charge a variable fee of $159-299 per year to add it on.
Company Track Record & Experience
ZenBusiness: They’ve only been open since 2015, but they’ve served thousands of customers already and are showing no signs of slowing down. They receive spectacular feedback from their clients as well, as their thousands of reviews are almost all positive.
LegalZoom: LegalZoom has been around since 1999. With more than 6 million customers served (about a third of which are business clients), they handle a higher volume of customers than just about any competitor. LegalZoom also receives mostly positive customer feedback, although its reviews have both a slightly lower quantity and quality than Zen’s.
Customer Service
ZenBusiness: You can access the ZenBusiness customer service department by phone, email, or through the chat application on their website. In our experience using these three options, we’ve always found that their reps are helpful and friendly, and we never have to wait very long to get a response from them.
LegalZoom: LegalZoom provides support via email or phone, and we’ve used both of these options several times. Their email support can have some very long response times, as we’ve waited about a week to get a reply before, and their responses are typically just form emails that don’t address any specifics. Their phone support is a different story though, as their representatives go into detail when responding to our questions, and they’re always easy to get ahold of.
Ease of Use
ZenBusiness: You can fill out their order form quite quickly, and their instructions are simple and straightforward. The only things you need to do to get the ball rolling with ZenBusiness are select the package you’d like to purchase, and provide them with some basic information about yourself and your company. We will note though that they have a few upsells and third-party offers spread throughout the order form that can be a bit distracting.
LegalZoom: LegalZoom structures their ordering process differently than most competitors. Instead of starting by selecting your package and then building your order from there, LegalZoom has you start by entering your personal information. After that, they lead you through a series of expensive upsells (exceeding $1,000), before finally letting you select your formation package. It’s a convoluted process that can sometimes result in higher-than-expected total costs.
Speed of Formation
ZenBusiness: With ZenBusiness, turnaround times are not based on each state’s processing speeds, but rather on which of their packages you select. While they do say that their turnarounds vary a bit by state, rough estimates on their Starter package have a 3-4 week turnaround, their Pro package can be completed in 1-2 weeks, and their top-tier Premium plan takes 3-5 days.
LegalZoom: They structure their turnaround times the same way ZenBusiness does, estimating by package instead of by state. With LegalZoom, their most affordable packages have a 30-business-day (six-week) turnaround time, while their most expensive package can be completed in 7-10 days.
Conclusion – Which Is Better?
All told, we think ZenBusiness has a lot more to offer the majority of our readers than LegalZoom does. They’re the winner of this comparison and quite frankly one of the best options available for incorporation and LLC formation.
While LegalZoom has some advantages of their own ― like their large infrastructure and track record ― their overall value doesn’t hold a candle to ZenBusiness. Plus, ZenBusiness has faster processing times, as well as superior ease of use.
Don’t get us wrong ― LegalZoom is such a popular company for a reason, as they do provide reliable and professional services. It’s just that ZenBusiness is an even better option in several different ways.
Common Questions
What Is the Biggest Advantage of Each Service?
The biggest advantage for ZenBusiness is the fact that they offer a business formation process that costs just $49 (except for your state fee), whereas with LegalZoom you’ll pay at least $149 for incorporation service.
LegalZoom has some advantages of their own though, especially their experience and customer volume, as they’ve been around for much longer and served many more clients than ZenBusiness has.
Which Is the Best Package Available From These Services?
We typically advise that our readers select the most affordable business formation package that includes registered agent service. Seeing as neither company in this comparison offers incorporations with registered agent service included, we prefer the ZenBusiness Starter package for $49, which includes one year of annual report service, along with up to two amendments per year, some customizable business documents, and a free accounting assessment.
After your first year, the Starter plan renews for $199 per year, which is a pretty high price point for ongoing annual report service and amendments. Still, this package truly provides everything you need and nothing you don’t.
Which Company Offers More Help With Ongoing Compliance Requirements?
You can get assistance with ongoing compliance issues from either of these companies, although their prices for providing these services have some differences.
With ZenBusiness, you can obtain registered agent service for $99 for the first year and $199 per year after that, and their annual report service costs $100 per year. As for LegalZoom, you can get their registered agent service for a variable annual fee of $159-299, but their annual report service is very competitively priced at $55 per year. Keep in mind that ZenBusiness includes a year of annual reports for free though, which LegalZoom does not.
Can I Get a Refund if I Need One?
LegalZoom and ZenBusiness have fantastic refund policies that are nearly identical. If you decide at any time within 60 days of your purchase that you’re less than satisfied, they will provide a full refund of your service fees. There are no questions asked, and they don’t charge any sort of processing fee.
Which Is the Better Option if I Need Publication Service?
In some states, you need to publish your company’s formation in a regional newspaper. For example, Arizona and Nebraska require publication for LLCs and corporations, New York requires it for LLCs only, and Pennsylvania and Georgia have this requirement for corporations only.
While LegalZoom does not handle this step for you and does not offer any sort of assistance, ZenBusiness actually offers to take care of your entire publication requirement on your behalf.
Do Either of These Services Go Overboard With Upsells?
Both of these companies have their fair share of upsells. As you work your way through the ZenBusiness Starter order form, you’ll find around $500 in upsell attempts, as they try to convince you to add on features that are included with their more expensive packages.
With LegalZoom, you’ll encounter many more upsells, as their order form has $1,080 in upsell attempts on it. Obviously, this isn’t a strength for either of these companies, but LegalZoom is certainly much worse in this regard.
Am I Required to Use a Company Formation Service?
You are not legally required to use any sort of professional service to help form your business entity. If you would rather form your own corporation or nonprofit corporation, we have a detailed step-by-step guide that you can reference throughout the process.
However, you should know that the corporation is a complicated business structure in general, and we don’t usually recommend forming your own unless you’re already experienced with the incorporation process.