You want to create an LLC. You have your vision, your business name, and the motivation to make your dream a reality. But you want some help getting started, so you’ve decided to hire a business formation service.
But that leads to a big decision: which service should you use? There are a lot of options available, but they’re not created equal. Two popular services are LegalZoom and Rocket Lawyer.
In this guide, we’ll give you a side-by-side comparison of these two services. Then you can pick the right service for you.
Rocket Tip: Looking for the best and most affordable LLC formation services? Compare the top 3 online incorporation services to see how they stack up.
Our philosophy: What makes a formation service “good?”
Ultimately, the “top LLC formation service” boils down to a matter of opinion. Which one is best for you depends on what you want from a service. But that said, there are certain qualities that make one formation service better than another.
Whenever we evaluate an online LLC service, here are some questions we like to ask:
- Does this service give me a good value for what I’m paying?
- Does this company have a proven record of supplying high-quality service?
- What is the quality of this company’s customer service?
- How easy is it to use this service?
- How quickly will my business be formed?
A good LLC service will receive high marks in these categories. We’ll consider the answers to these questions in our in-depth comparison below.
LegalZoom vs. Rocket Lawyer: What’s the difference?
On the surface, LegalZoom and Rocket Lawyer seem to accomplish the same purpose: helping you form your LLC. And while that’s true, the difference between them goes much deeper than that. We’ll give you our full analysis in just a moment, but here are a few key differences:
- LegalZoom and Rocket Lawyer both offer business and private legal services alike. Not all online formation services have such a broad customer base.
- Rocket Lawyer only offers one package option, so their pricing model is as simple as it gets. LegalZoom has a lot more package options.
- Rocket Lawyer used to get negative reviews pretty often, especially because it was hard to withdraw from their some of their free trials. Since then, they’ve made huge strides in correcting these issues, so their feedback has improved a lot.
LLC service pricing and features
Whenever you make a purchase, you want to know that what you’re buying is truly worth the cost. The same goes for LegalZoom and Rocket Lawyer. Each service has their own range of packages and price points; they’re pretty comparable in value. Let’s take a look at them.
- Economy: LegalZoom’s entry-level price points rings in at $99. For that fee, you’ll get a name availability check, letter of financial authorization, and filing of your Articles of Organization.
- Standard: Standard makes a large money jump to a $329 price tag. With Standard, you receive all of the Economy features, plus 20 official membership certificates to use in your LLC. You’ll also get a corporate kit, which is an official, embossed binder and seal that’s been customized for your business.
- Express Gold: LegalZoom charges $349 for their highest package, but it doesn’t have much more to offer over the Standard option. The extra $20 really only buys you an expedited filing.
- Base package: Technically, Rocket Lawyer only offers one package option. It costs $99, and for that price, they’ll file your business formation paperwork for you. However, if you’re a new customer incorporating with Rocket Lawyer, then you can receive discounts off their other services. As a downside, this package doesn’t include registered agent service.
- Legal subscription service: For $39 a month, you can get access to legal advice from Rocket Lawyer’s legal network. That includes opportunities to speak with a lawyer when you have a new question arise, legal review of your business documents, and more. While this isn’t a necessity for a lot of businesses, it can be helpful for entrepreneurs who know they will encounter lots of legal questions along the way.
LegalZoom and Rocket Lawyer come up tied in this category: both have a $99 entry-level package. That’s a fair pricing point, but it’s not competitive, either. Both services leave out registered agent services, too. Some competitors add in six months to a year for free. All told, the two are tied for a middle-of-the-pack pricing model.
How easy it is to use the service
Any business service is supposed to make your life easier, right? That’s why we always consider how easy it is to use a service when we evaluate them. After all, why would you bother paying someone to file your paperwork if it’s harder to hire them than it is to do it yourself?
We tested both services, and Rocket Lawyer is much simpler to use. LegalZoom’s order process seems a bit backwards to us. Here’s the run-down of the two:
- Choosing a package: Unfortunately, with LegalZoom, picking the package you want is a touch difficult; you pick your package after you’ve input some of your information and chosen a few add-ons.
- Up-sells: If there were a competition for which company offers the most up-sells and third-party offers during their order process, LegalZoom would win hands-down. It’s very easy to spend extra money after getting distracted with all the add-ons they offer.
- Order time: Once you get past the up-sells, it doesn’t take too long to finish your order. For example, it took us about fifteen minutes to get to the package selection stage. Then the rest of the process took a bit longer.
- Choosing a package: Since Rocket Lawyer only offers one package, you just have to get started.
- Up-sells: Rocket Lawyer does have a few up-sells throughout their order process. Thankfully, they are still pretty easy to navigate, and we appreciate that all the up-sells are offered by Rocket Lawyer, not by third parties.
- Order time: Despite the up-sells, Rocket Lawyer is fairly easy to use. It takes about ten minutes to complete the order.
In our opinion, a user-friendly service does two things: it employs a clean, straightforward order form, and it largely avoids up-sells and third-party offers.
Both Rocket Lawyer and LegalZoom present some up-sells and third-party offers along the way. The offers from Rocket Lawyer are a little more straightforward, though. We also think their order form is much easier (LegalZoom does it backwards). Because of that, we think Rocket Lawyer takes another win for the ease of use category.
Buying a product is one thing. But getting support for that product is just as important. After all, if a company doesn’t stand behind its product, why should you? But when a company helps you throughout the entire process—choosing a product, purchasing it, and keeping that product up-to-date—you’ll be happier with your purchase.
The same goes for business formation services. If they help you pick the package that’s right for you, assist you with the paperwork, answer your questions, and make it clear that they want to help you more than make money off you, you’ll keep using them. You might even recommend them to your friends.
Rocket Lawyer and LegalZoom both have good customer support teams. Here’s a summary of our thoughts on the customer service of both services:
- Types of support: LegalZoom offers support via phone and email.
- Availability: LegalZoom has very prompt service and great hours. On weekdays, you can reach them from 5 a.m. to 7 p.m. (PT) and 7 a.m. to 4 p.m. on weekends.
- Quality of support: When we tested LegalZoom’s customer support, we found their representatives to be quite helpful, especially via phone. (Email replies were more generic). The only thing we found annoying was that their customer service representatives also tried to make a sale during the process.
- Types of support: Rocket Lawyer also offers support via phone, email, and online chat.
- Availability: Rocket Lawyer has pretty similar availability to LegalZoom’s, with hours ranging from 9 a.m. to 9 p.m. ET every weekday.
- Quality of support: Rocket Lawyer’s customer service representatives really know their stuff, and they answered all of our questions promptly and courteously.
This category is ultimately too close to call. Each company has a feature that one-ups the other: LegalZoom has wider hours of operation, and Rocket Lawyer has better email support. This category is a tie.
Company track record
Technically, there’s nothing wrong with using a new company to form your business. But working with an established, trusted brand gives you confidence. You can trust a company that has already served thousands of happy customers.
The difference between these two companies boils down to experience against reputation. LegalZoom has more experience, but Rocket Lawyer has better customer reviews. Here’s how the two stack up:
- Years in business: Founded in 2001, LegalZoom has been in business for close to twenty years.
- Businesses formed: LegalZoom has helped form over a million businesses (and they’ve served nearly 4 million customers in other legal avenues).
- Customer reviews: LegalZoom’s online reputation is mixed; you’ll find a wide variety of one-star and five-star reviews alike.
- Years in business: Rocket Lawyer has been in operation since 2008.
- Businesses formed: Even though Rocket Lawyer is younger than LegalZoom, they’ve served more customers. Their clients number more than 20 million; granted, not all of those are strict business formations, but that number is a clear indicator that customers have confidence in their service.
- Customer reviews: In the past, Rocket Lawyer got mixed reviews. Now they have mostly positive reviews, so they’ve fixed the issues that customers used to complain about.
Both companies have firmly established themselves in the industry; their customer value is impressive. That said, Rocket Lawyer has served more customers (especially if you add in their non-business clients). On top of that, Rocket Lawyer’s customer feedback is a lot better. This category is another win for Rocket Lawyer.
If you ever change your mind about a product you’ve purchased, you want to be able to return it, right? Unfortunately, with any business formation service, a full refund is impossible. That’s because part of the money goes to the state as their incorporation fee, and states do not refund those fees.
But occasionally, a customer changes their mind about a package they purchased. Perhaps they no longer want to subscribe to the registered agent service, or the company completes the process incorrectly. Each company has their own policy for refunds, and LegalZoom and Rocket Lawyer are no exception. We’ll summarize those policies here.
You can cancel your service with LegalZoom at any time (although some customers have noted that cancelling can be a bit tricky). Refunds are also allowed if they fall under LegalZoom’s Satisfaction Guarantee and you make the request within 60 days. You can also exchange for a comparable service, too.
With Rocket Lawyer, getting a refund is a little bit tougher; you have a 30-day window. If you request a refund during that time, you won’t even have to pay a convenience fee. However, Rocket Lawyer can’t offer refunds on any third-party services or fees paid to your state.
Assistance with ongoing compliance
Starting your business takes a lot of time and effort, but so does maintaining it! Each state is a little different; some require annual reports, some require you to renew your license each year, and more. Keeping track of these requirements can be confusing.
That’s why a lot of services help you with ongoing compliance. But just how much help you’ll get depends on what service you choose.
For $69 per year, you can subscribe to LegalZoom’s Compliance Calendar program. This service helps you stay up-to-date with your due dates by alerting you so you can get them filed on time. You can also subscribe to additional services that will complete this report for you, if you’d like. They also offer registered agent service for $159-299 per year. We’re not quite sure why there’s a price range for this service; you have to contact them directly for a full quote.
Rocket Lawyer does not offer a specific business compliance program. But their legal subscription service is its own kind of compliance assistance: a lawyer will review all of your official documents before you file them. This service costs $39.99 per month.
So, which LLC service do we recommend?
LegalZoom and Rocket Lawyer both can be a big help when it comes to getting your business off the ground. We don’t think they’re on the same level, though. Rocket Lawyer takes the win in pretty much every category we’ve covered. The only one they don’t win is the most important: pricing and value.
That’s not to say that LegalZoom is a bad company: they wouldn’t have so many customers if they were. Rocket Lawyer is just easier to use, and their customer feedback is far better. For us, that’s enough to win them our recommendation.
Alternatively, you can check out your other options through our comparison guide of the 3 most affordable and top LLC services.