ZenBusiness vs LegalZoom

Are you looking to form a limited liability company, a corporation, or a nonprofit, but you’re stuck trying to settle on the best formation service to use?

Choosing the right service for your business and legal needs can be difficult. That’s why we’ve carefully evaluated over a dozen of the top formation service providers, looking at and comparing metrics across several key categories, such as pricing and turnaround time.

We took an in-depth look at both ZenBusiness and LegalZoom in their respective individual reviews. In this article, we’ll compare them head-to-head.

ZenBusiness vs LegalZoom: Verdict

Our side-by-side comparison of these two companies had ZenBusiness as the clear winner.

ZenBusiness offers everything we want to see from a business formation service. Their website is easy and intuitive to use, and they offer great turnaround times for all LLC formations and incorporations.

ZenBusiness customer service is professional, responsive, and can advise customers on all aspects of forming a new business. Customers seem to agree – they have given ZenBusiness an average rating of 4.8 out of 5 on major review websites.

On top of everything, ZenBusiness’s service is very affordable. The ZenBusiness Starter package is priced at only $39 and includes all the services we deem essential to forming your business, including a free first year of ZenBusiness’s registered agent service. Even their more expensive plans are filled with useful additions, rather than useless “fluff.”

Compared to ZenBusiness, LegalZoom did poorly in several categories. In particular, LegalZoom’s formation costs are simply too high – the service is among the most expensive we have seen, yet it does not offer any significant added value compared to alternatives.

Since ZenBusiness did well across all of our categories, we believe that they are a great fit for the business needs of most entrepreneurs. We recommend the service without reservation.

Read on to find out more about how we arrived at our verdict in this head-to-head comparison.

ZenBusiness vs LegalZoom: Pricing

Pricing is the first thing most new business owners will look at when comparing formation services. We agree that prices are important – that’s why we assign pricing a 2x weight in our service evaluations

Unfortunately, comparing the prices of services can be a hassle – especially if you are a first-time business owner. Most formation services offer a comparable set of products and services, though what, exactly, is included in any given package can vary dramatically.

To make things a bit clearer, we’ve presented the pricing on what we consider to be the three most relevant services to startups: “basic” formations, “full” formations, and the cost for an annual registered agent service.

Keep in mind that you will have to pay state filing fees (usually ~$50-$150) in addition to the service fees listed here.

Not sure what a “Basic Formation” or a  “Full Formation” is? Here’s how we define each:

Basic Formation: Covers the essentials of business entity creation. Includes – at minimum – filing of Articles of Organization and the drafting of an Operating Agreement for an LLC or corporate bylaws for a corporation.

Registered Agent (standalone): Price if you’re only looking for a registered agent service.

Full Formation: Additionally includes – at minimum – a registered agent service, which most owners will find essential. Price includes one year of registered agent service.

ZenBusiness

ZenBusiness offers its formation and incorporation services through three formation packages. The Starter plan, priced at $39 per year, is the most affordable and basic of the three. The Pro plan, priced at $149 per year, includes several additional formation-related services. Finally, the Premium plan, priced at $249 per year, includes several web-related services as well.

For most basic formations or incorporations, ZenBusiness’s Starter plan should fit the bill. It includes the three services we consider vital for all formations: the preparing and filing Articles of Organization or Incorporation (with a prior business name search), an Operating Agreement (if you are forming an LLC) or Corporate Bylaws (if incorporating), and an annual registered agent service. If you are just looking to get your business up and running and don’t want any unnecessary bells and whistles, this is probably the package for you.

The ZenBusiness Pro plan builds on top of the Starter plan by adding a few useful additional services and features. It includes ZenBusiness’s ‘Worry-free compliance’ service, which lets you leave the handling of your annual reports – legally required to maintain good standing with your state’s government – to ZenBusiness.

ZenBusiness will also obtain an employer identification number (a tax id number) from the IRS on your behalf. Your overall filing will be expedited, resulting in a faster turnaround time and, finally, ZenBusiness will provide you with a banking resolution template – an important document needed to open a business bank account.

ZenBusiness’s Premium plan is built to help kickstart your company’s online presence. In addition to all of the formation-related services above, ZenBusiness will register a business domain name (URL) and a business email address for you and provide you with a professional-looking business website for your company. The Premium package also includes rush filing, resulting in the fastest possible turnaround time.

One thing to note is that ZenBusiness charges its formation fees annually – they are not one-time costs. However you are free to cancel their services at any time without penalty, so we don’t consider this pay structure to be a negative.

LegalZoom

LegalZoom’s formation offerings are also made through three formation packages. They include the Economy package, which costs $79 for formations or $149 for incorporations, the Standard package, which costs $329, and the Express Gold package, which is priced at $349. Keep in mind that these prices do not include the applicable state filing fees.

Surprisingly, none of these packages include two of the three services we consider essential. You will have to pay an additional $99, on top of your package cost, for Operating Agreement or Corporate Bylaws drafting. You will also need to pay $299 per year if you want to sign-up with LegalZoom’s registered agent service. Most other services we reviewed (including ZenBusiness) include at least one of these with their formation packages.

LegalZoom’s Economy package is quite basic and contains only an availability check for your desired LLC or corporation name and the preparation and filing of the relevant formation documents with the state. LegalZoom also promises that they will check your legal documents for errors and omissions, though we would expect this of any service anyway.

The LegalZoom Standard package’s main feature is a faster turnaround time: 15 business days, as opposed to 30 with the Economy package. The listing for incorporations makes it clear that this is a form of internal expediting. We consider it a negative when formation services charge for internal expediting – many of the better services we reviewed (such as Northwest Registered Agent) will file all orders as quickly as possible without added costs.

The Standard package also includes a corporate binder, corporate seal, and share certificates. While these may have sentimental value to some business owners, they are not legally necessary.

The Express Gold package will result in the fastest turnaround times by including rush processing (“LegalZoom VIP processing”) and the express shipping of your final approval documents. LegalZoom claims that they can form your LLC or corporation within 10 business days if you select this package.

Pricing winner: ZenBusiness

This category was no contest: ZenBusiness offers some of the best prices in the industry without compromising on the contents or quality of the service they provide. Their basic plan is priced affordably and includes everything that is necessary for a formation, while their more expensive offerings include useful additional services for reasonable prices.

On the other hand, LegalZoom charges some of the highest prices of all the formation services we have reviewed, especially when factoring in the need to pay additional costs for an Operating Agreement or a registered agent service.

ZenBusiness vs LegalZoom: Turnaround Time

Offering speedy business formations is an essential trait for any good formation service provider. There would be little sense in using these services if you could form your business faster and more efficiently on your own.

Formation services can optimize their turnaround times in a number of ways. The most important is to ensure that orders are internally processed as promptly as possible. In the case that more information is needed from a customer, a company should reach out and address the issue quickly. 

Formation services should also use, or at least offer, any possible expediting options with the state government to further reduce processing times (many state governments will allow you to “jump” the processing line in exchange for an extra fee).

ZenBusiness

In general, ZenBusiness offers solid turnaround times. The exact turnaround times for standard orders can vary wildly depending on the state, with some states allowing non-expedited formations in as little as five days, while other states may require you to wait several weeks. As an example, a non-expedited LLC formation in California will take between 10 and 13 days. A non-expedited formation in New York will be even faster and complete in just 5 to 6 days.

If you need your business to be formed a bit quicker, you can opt into expedited or rush filing (expedited filing is included with the Proplan and rush filing is included with the Premium plan). Expedited filing will result in a turnaround time of around 5 to 10 days in most states, while rush orders offer the fastest possible turnaround time – five days or fewer in many cases, and sometimes as little as one day.

While both rush filing options are included with the higher-tier formation plans, you can also tack them on to a normal filing for an additional cost. In that case, expedited filing will cost $50, while rush filing is priced at $100.

If you’d like to check ZenBusiness’s expected turnaround times for your state and business type, you can use this tool on their website.

LegalZoom

LegalZoom’s turnaround times aren’t amazing. LegalZoom provides a total processing time estimate of 30 business days when using their Economy package. In order to form your business quicker, you have to opt into their more expensive service packages – if you choose the Standard package, your business should be formed in 15 business days; if you select the most expensive option, you should be set in around 10 business days.

Both the LLC formation and incorporation pages make it clear that LegalZoom internally prioritizes orders depending on the cost of the ordered package. This implies that your order will be internally delayed if you choose LegalZoom’s Economy package.

Turnaround time winner: ZenBusiness

ZenBusiness is the clear winner on turnaround time. In most cases, both ZenBusiness’s standard and rush filing times are faster than what LegalZoom advertises.

ZenBusiness also makes it easier to selectively expedite your formation order, whereas LegalZoom’s turnaround time depends only on which package you go with.

We also dislike that LegalZoom internally delays less pricy orders in favor of more expensive ones in order to push customers towards their higher formation tier.

ZenBusiness vs LegalZoom: Customer Satisfaction

Most formation services we look at claim to be the best. They promise an easy and hassle-free formation experience to their customers. Unfortunately, the reality is that not all services can follow up on their promises, with some business formations ending up delayed by weeks due to errors or poor filing handling.

This is why, in order to better evaluate services and make good recommendations, we always look at customer satisfaction when comparing companies. The experiences of past customers help to make it clear which services will keep their promises and which should be avoided.

We measure customer satisfaction by means of independent customer reviews. We look at both the average rating customers assign to services, as well as the total number of reviews. We also read the customer feedback itself to better understand a service’s strengths and weaknesses.

Here is how ZenBusiness and LegalZoom did in this category:

ZenBusiness

Despite being a relatively new company – it was founded in 2015 – ZenBusiness has managed to establish an excellent reputation and track record with customers. They are currently rated 4.8 out of 5 on Trustpilot with more than 6,000 overwhelmingly positive reviews.

Reviewers praise all aspects of ZenBusiness’s service – though we found particular praise for its speed and ease of use, with many customers expressing surprise about how easy it was to form a business. Customers also seemed happy with ZenBusiness’s professional and helpful customer service staff.

ZenBusiness’s customer outreach team regularly replies to reviews. We liked, in particular, that they replied to more than half of the (relatively few) negative reviews they received, providing explanations and clarifications where necessary.

LegalZoom

LegalZoom performs decently in terms of customer satisfaction. They are rated 4.1 out of 5 on Trustpilot, with 700+ reviews, and are also rated 4.1 out of 5 on the Better Business Bureau’s website, with more than 2000 reviews.

Based on their reviews, most of LegalZoom’s customers were satisfied with the service they received, while a minority encountered issues with their filings or LegalZoom’s customer service. About 28% of Trustpilot users rated the company with one star.

Most of the satisfied customers gave full marks to the service and praised its simplicity. First-time business owners, in particular, were happy with LegalZoom’s knowledgeable and professional customer service staff.

Customer satisfaction winner: ZenBusiness

ZenBusiness has received near-universal praise from their customers and holds one of the highest average ratings among the business formation companies we have looked at. Most customers were impressed with how easy it is to form a business using their service.

LegalZoom has a decent average score, however, their overall rating is dragged down by a number of customers who have had bad experiences with the service.

ZenBusiness vs LegalZoom: Ease of Use

Forming a business online should not be any more of a hassle than it needs to be. That’s why we want to see services that simplify things as much as possible while still leaving their customers in control of important decisions.

In the ease-of-use category, we look at the complete user experience when forming an LLC or corporation. We look not only at the order process but also at how well services inform and educate their customers on relevant topics (informative service pages and up-to-date legal articles are a big plus here).

Here is how ZenBusiness and LegalZoom did on this front:

ZenBusiness

ZenBusiness’s formation service is quick and simple to use. Finding what you need is easy, and ZenBusiness’s service pages offer ample context information about their offerings.

Handling your part of a business formation takes only a few minutes, and ZenBusiness’s website will guide you through the entire process. You will only need to answer a few basic questions about your future business and the rest will be handled for you.

In case ZenBusiness needs any supplementary information, they will contact you promptly before moving forward.

Pricing information for all of ZenBusiness’s services is displayed front and center on the relevant pages, and they also do a good job explaining why customers might need services in the first place.

We also appreciate that ZenBusiness shows restraint and doesn’t try to unnecessarily upsell their customers with poor-quality third-party services offers or by locking essential services behind more expensive plans and packages.

LegalZoom

LegalZoom’s website is modern and sensibly structured, with dedicated information pages for all relevant legal services. Pricing information, terms and conditions, and all supplementary information is displayed clearly.

LegalZoom also includes a large library of educational articles on legal and business topics on their website. Their articles are easy to digest and contain useful information to help customers better understand the formation process and the decisions they have to make.

As with most other services, ordering an LLC formation or incorporation is a simple step-by-step process and can be completed in minutes. LegalZoom does offer a number of upsells along the way, although not excessively so.

Ease of use winner: ZenBusiness

Both ZenBusiness and LegalZoom offer a great user experience to anyone looking to start a business. Both services will let you file online in just a few minutes, while their staff handles the rest.

Both services are fairly evenly matched in this category, but if we had to pick a winner, it would be ZenBusiness – they specialize exclusively in business formations, and their entire user experience is geared towards entrepreneurs looking to create a new business entity.

ZenBusiness vs LegalZoom: Help & Support

While it’s great that it’s now possible to set up a business entirely online, there might come a time when you have a question or an issue that can’t be answered or resolved by an automated system.

Doing business with a formation service that offers professional and responsive customer support can mean the difference between fixing an issue in just a few minutes or having your start-up’s formation delayed by days or weeks.

To see how well companies do in this regard, we look at several factors and ask several key questions. 

Does a service offer a good variety of contact methods? Does their customer service respond quickly and answer thoroughly? Does a company offer extended business hours during weekends and holidays? 

We also take into account the quality of the service’s help sections on their website, as well as the experiences of past customers.

Here is how ZenBusiness and LegalZoom performed:

ZenBusiness

ZenBusiness scores full marks in our help and support section – the service offers everything we could ask for regarding customer support. Their contact section contains several contact methods: you can call them, contact them via email, chat with a representative online, or send them physical mail.

ZenBusiness promises to reply to all messages within one business day. They managed to do even better than that when we sent them a message with a few questions – they replied to us within one hour and provided exhaustive answers to all our questions.

ZenBusiness is one of the few services to offer extended support hours to their customers. You can call them on weekdays between 8 am and 8 pm CT or on Sundays between 10 am and 7 pm.

Like most other formation services, ZenBusiness has a well-developed help section on their website. They also offer many easy-to-digest articles aimed at educating first-time small business owners about everything they need to know to form an LLC or corporation.

LegalZoom

Getting in touch with LegalZoom’s customer service or sales team is simple, with multiple contact methods available. You can call them, leave a message on their website, or send them an email at support@legalzoom.com. We should note, though, that when we contacted LegalZoom’s email support and asked some clarifying questions, we were told to call their sales team instead.

LegalZoom also has a help section with a decent number of FAQs, as well as their library of educational articles. These should cover the majority of questions customers may have.

LegalZoom is also one of the few companies that have customer support available seven days a week. You can call or message them Monday through Friday between 5 am and 7 pm PT or between 7 am and 4 pm PT on weekends.

Help and support winner: ZenBusiness

Both ZenBusiness and LegalZoom do great when it comes to customer support. They both do excellently at helping first-time business owners navigate their way through the business formation process and beyond. Both companies also offer extended business hours – something we would like to see from more competitors – and both companies have well-developed help sections on their respective websites.

Ultimately, ZenBusiness edged out their competitor by providing a greater variety of contact methods and by having one of the quickest, most responsive support teams we’ve seen in the industry.

Do we recommend ZenBusiness or LegalZoom?

We recommend ZenBusiness.

We believe that ZenBusiness offers the best overall combination of quality and pricing.

ZenBusiness’s formation plans are priced very competitively and include everything we think is necessary to start an LLC or corporation. Their formation service also offers great turnaround times, a professional and accessible customer service staff, and sports an excellent rating of 4.8 out of 5 on independent review sites.

ZenBusiness performed great across all of our metrics and categories. We recommend ZenBusiness without hesitation for both first-time business owners as well as serial entrepreneurs.

For a more in-depth look at their service, check out our dedicated ZenBusiness review. If you would like to compare ZenBusiness with some other options, be sure to take a look at our Best LLC services or Best Incorporation services articles as well.