It’s important to seek guidance from professionals if you’re unsure how to start a business and keep it running smoothly. How do you get an employer identification number and what sorts of paperwork do you really need to file for an LLC?
Companies like ZenBusiness and LegalZoom exist to help you with business formation and make it easier for your business to grow. But is one service better than the other?
In this ZenBusiness vs. LegalZoom review, we dig into the features that differentiate these two business services, including how they work and what their strengths are. This will help you decide whether ZenBusiness or LegalZoom would be a better fit for your business.
ZenBusiness vs. LegalZoom
Both ZenBusiness and LegalZoom offer a variety of services that can help you learn how to start a business and make it easier to keep your business running. They could both be particularly helpful if you're looking for support in starting an LLC, or limited liability company. Here’s a quick overview of how the two companies compare to each other.
|Customer service||Chat, email, and phone||Chat, online submission form, and phone|
|Types of businesses||LLC, corporation, and doing business as (DBA)||LLC, corporation, nonprofit, and doing business as (DBA)|
|Registered agent service||
||$249 per year|
|CPA assessment||Included in all plans||Not available|
|Personal legal services||Not available||
|Visit ZenBusiness||Visit LegalZoom|
How does ZenBusiness work?
ZenBusiness is a Public Benefit Corporation, which is a corporation that generates revenue but also has a public benefit purpose. ZenBusiness’ declared focus is to help people start, run, and grow businesses. This is primarily accomplished through different ZenBusiness services, such as the three plans it offers, as well as a la carte services.
Here are the business formation packages ZenBusiness provides:
|Time to form business||14 to 21 days, varies by state||1 to 2 days, varies by state||1 to 2 days, varies by state|
|Price||$0 plus state fees||$199 a year plus state fees||$349 a year plus state fees|
Each plan is paid on an annual basis, though it’s possible to add a la carte services. However, some services, such as registered agent services and operating agreement templates, are only available through the offered plans.
For more details, read our ZenBusiness review.
How does LegalZoom work?
LegalZoom also offers services for creating and running businesses. This includes a similar structure to ZenBusiness in that they provide three plans to choose from depending on your business needs.
Here are the plans LegalZoom provides and which services are included:
|Time to form business||30 business days||15 business days||10 business days|
|Price||$0 plus state filing fees||$249 plus state filing fees||$299 plus state filing fees|
It’s important to note that LegalZoom business formation plans are a one-time fee plus state filing fees, whereas ZenBusiness plans are paid on an annual basis plus state filing fees.
What both business formation services excel at
These two business service providers overlap in different ways. Here are a few areas where both ZenBusiness and LegalZoom excel:
- Business formation: If you need to form a business and aren’t sure how it’s done, both ZenBusiness and LegalZoom can help. They offer services that take you through the business formation process according to your needs and your state’s requirements. Each company offers options for different types of businesses.
- Customer reviews: According to the Better Business Bureau and TrustPilot, both companies are doing above average when it comes to their ratings from customers. ZenBusiness has a lower customer review rating on Better Business Bureau than LegalZoom, but it’s rating on TrustPilot is better and also has a higher number of reviews. Many of the reviews for each company talk about how fast and easy the services are to use.
- Customer service: It’s helpful to have multiple options for customer service depending on how you like to interact with people. ZenBusiness offers chat, email, and phone options. LegalZoom provides options for chat, phone, and an online submission form.
- Refund policy: It’s important to have some peace of mind when buying services that might cost you hundreds of dollars. What if you aren’t satisfied with the services or they weren’t what you expected? Both ZenBusiness and LegalZoom offer a 60-day refund policy if you aren’t satisfied with their services. However, these refund policies don’t apply to certain third-party processing fees and state filing fees.
- Important business services: ZenBusiness and LegalZoom offer services that are vital to most businesses. This includes registered agent services, services that help you keep you in good standing as far as state compliance, and the actual preparation and filing of different legal documents.
4 important differences between ZenBusiness and LegalZoom
To properly gauge the comparison of ZenBusiness vs. LegalZoom, consider how each company differs from the other. Here are a few differences between both companies:
The pricing structure for formation services is similar between both companies with three different plans to choose from. However, the plans from ZenBusiness and LegalZoom don’t necessarily offer the same services and the pricing structure is different between the two businesses.
ZenBusiness offers three plans that include loads of services. LegalZoom offers three one-time fee plans. The better pricing setup depends on your preferences and business needs. For example, ZenBusiness includes state compliance and annual reports in two of its annual plans, whereas LegalZoom offers those services separately.
If you want continued annual report filing with LegalZoom, you have to pay for the service each time, though LegalZoom does offer an annual subscription for its compliance calendar service. ZenBusiness offers price points ranging from $0 to $349 per year, whereas LegalZoom plan pricing ranges from $0 to $299.
Overall, neither company is the outright winner in this category because it depends on your business needs. The one-time fees of LegalZoom compared to the annual plans of ZenBusiness may seem more appealing, but you also have to factor in the services you’re receiving. As you add more services from LegalZoom, the price continues to go up. With ZenBusiness, many of the services are already included in the higher plans.
Winner: Depends on your business needs
2. Processing time
If you have a business idea and plan, you’re likely champing at the bit to get it set up and running. However, you have to comply with state requirements before your business is official. This typically involves submitting paperwork and filing it with the state where your business is being formed.
For processing times, ZenBusiness advertises a range of one to 21 days to get your paperwork filed. Paying for a higher plan would get you closer to the quicker end of the range, whereas a lower plan would put you near the slower end.
LegalZoom advertises estimated filing times between 10 and 30 business days. This is a much bigger range than what you see with ZenBusiness. By what it advertises, ZenBusiness is the quicker option for getting your business documents filed if turnaround time is critical for you.
- Solid track record of helping businesses get started
- Fast filing speeds
- 100% accuracy Guarantee
3. Accounting consultation
Running a business typically means dealing with business expenses and taxes, which may be unfamiliar for many people. However, the accounting side of your business can be a determining factor in whether it continues running smoothly.
When you sign up for a ZenBusiness plan, you automatically receive a free accounting consultation with a certified accountant to determine what types of resources would be a good fit for your business accounting needs.
LegalZoom doesn’t currently offer this type of service.
4. Additional services
Every business is different, which means your needs are likely different from those of another small business owner. One of the best ways to fit the needs of different types of businesses is to offer a variety of customizable services.
For example, ZenBusiness offers its three plans, and each one has included services, but you’re also able to add additional services to those plans or use certain services on their own. Some of the additional services offered by ZenBusiness include a business bank account, business website, business email address, and domain name registration.
LegalZoom also offers a variety of additional services, including loads of personal legal services pertaining to wills and trusts, real estate, and intellectual property. These types of services may not apply to every business owner, but they can be helpful in certain situations. In addition, you have options for many other business-related services, from corporate name changes to employment agreements.
The best option for additional services depends on the type of services you need, but LegalZoom tends to have more available options than ZenBusiness.
Which business formation service should you choose?
The best LLC service for you between ZenBusiness and LegalZoom depends on your specific needs and situation. Both companies offer services that can help you form a business and they’re well-reviewed by customers, though you may find a few differences in the details.
For example, you might choose ZenBusiness if you want an ongoing suite of services that can help you create your business and then continue running it from year to year. ZenBusiness plans are paid on an annual basis and include many of the services you might want for your business, such as annual reports, operating agreements, and a free accounting consultation.
In addition, you’re able to add more services to your plans as needed and for a price. These upsells include registered agent services or certain services (if your plan doesn’t already include them) such as worry free compliance or a business website.
On the other hand, you might choose LegalZoom if you don’t want to deal with plans based on annual subscriptions. LegalZoom offers plans with one-time fees plus additional options for loads of services that also have one-time fees. You might find certain services that have annual fees, such as a registered agent and a compliance calendar, make sense for you.
If you need both business services and certain legal services, LegalZoom is in a unique position to help on both fronts. This could make it a convenient one-stop shop if you fall into this category, which is more helpful than having to use services from multiple companies.
Which is better: LegalZoom or ZenBusiness?
The better company for you depends on your business needs. Both LegalZoom and ZenBusiness can help you form and run a business, but they have differences in the services they offer and how their pricing is structured.
For example, ZenBusiness has a free accounting consultation included with each of its annual plans. LegalZoom doesn’t include this service, but it offers both business-related services and personal legal services. LegalZoom charges for many of its services based on one-time fees instead of an annual basis.
Is LegalZoom worth it for an LLC?
If you’re inexperienced with setting up and running an LLC, it’s likely worth it to use a company like LegalZoom to help. LegalZoom offers services for submitting important documents to your state and can help your business stay compliant as well.
Does ZenBusiness handle New York publication requirements?
Yes, ZenBusiness offers services to handle New York publication requirements. This includes satisfying the requirements to publish an announcement of your new business in two newspapers for six consecutive weeks. In addition, ZenBusiness has relationships with counties and newspapers that can help keep your costs and fees low.
Is LegalZoom a good company?
LegalZoom is a legitimate business that can help people start and run their own businesses. It isn’t just about brand power — it has an A rating and a 4.6 out of 5.0 customer review rating with the Better Business Bureau and a 4.6 out of 5.0 TrustScore with TrustPilot. For more than 20 years, LegalZoom has helped millions of people with their business needs.
Is ZenBusiness worth it?
ZenBusiness services are worth it if you’re planning on forming a business or have an existing business and need help keeping it running. The company has an A- rating with the Better Business Bureau and a 4.6 out of 5.0 TrustScore with TrustPilot. Many customer reviews talk about how easy and simple ZenBusiness services are to use.
The ZenBusiness vs. LegalZoom comparison doesn’t have a clear overall winner because the two businesses aren’t the same. They offer some similar services, like LLC formation services. But you’ll also find certain services from each company that align with different types of businesses or individuals.
If you have an idea of how to make money with a new business, research both ZenBusiness and LegalZoom to see which one would be the better fit for your entrepreneurial goals. The details outlined above can give you insight into which service might make more sense for your business depending on your needs.
You might also consider looking over our list of the best credit cards for LLC owners. Having a business credit card can be a good first step in keeping your expenses and bookkeeping separate and easy to handle.