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How can a first-time founder access the US market and form a business, fast and legally?
Find out the process in this LegalZoom vs. Stripe Atlas comparison.
$149 - $349
$500 + $100/year
Entrepreneurs, small business owners, and individuals seeking accessible and cost-effective legal and tax assistance.
Startups in the e-commerce and tech industry looking for a formation service with an integrated payment processor.
Ask any entrepreneur looking to start a business if they’re excited about the venture, and most likely, they will say yes!
However, most will find it a complex journey, especially in a market like the U.S.
The reason is there is much to think about, from forming your startup to incorporating it in a US state and other critical legal processes.
However, as an entrepreneur, you can simplify the complexities of launching a startup by using a business formation and incorporation service.
Two that are prominent are LegalZoom and Stripe Atlas. The services can help any entrepreneur launch their venture fast and legally.
Now, LegalZoom helps startups form and incorporate their business as an LLC, C-Corp, DBA, or partnership in 50 states of the US.
Stripe Atlas helps entrepreneurs form and incorporate their startups in Delaware as an LLC or a C-Corp.
However, how do they compare, and which one offers more value?
Let’s find out in this LegalZoom vs. Stripe Atlas comparison.
LegalZoom vs. Stripe Atlas at a glance
|SMB Guide’s Rating
|Business Formation Services
|LLC, partnership, C-Corp, non-profit, or DBA
|LLC and C-Corps
|5 to 14 days
|Registered Agent Services and Costs
|Name Availability Search
|Online Document Access
|No money back guarantee
|Founded in 2001
|Founded in 2010
|Customer Education and Resources
|Phone, live chat, email
|Email and support tickets
|$149 – $349
|$500 + $100/year
|Convert as you grow
LegalZoom: Features, Pros, Cons, & Pricing
The service goes on to provide entrepreneurs with tools, educational resources, legal consultation, and more.
Unlike most other formation services, LegalZoom is all-rounded, offering services such as intellectual property protection, registered agent services, and more.
If you subscribe to their premium package, you get access to legal consultation from an independent network of attorneys.
Pros & Cons
100% satisfaction guarantee
User-friendly and easy processes
Incredible customer support
Wide range of legal services
Registered Agent service is expensive
LegalZoom offers three packages: Basic, Pro, and Premium. The plans come with a money-back guarantee of 60 days and they include:
- Basic: $0 + state fees
- Pro: $249 + state filing fees
- Premium: $299 + state filing fees
Stripe Atlas: Features, Pros, Cons, & Pricing
Stripe Atlas is a platform that helps entrepreneurs form and incorporate their startups in Delaware. Entrepreneurs can choose between an LLC or a C-Corp as an entity.
Now, the service offered goes beyond incorporation, where businesses can request an expedited EIN and a US bank account.
Startups also get Stripe as an online payment gateway and access to Atlas partners with benefits worth over 100k.
Pros & Cons
Built for founders
Only LLC’s and C-Corps
Focus on Delaware incorporation
Startups will find that Stripe Atlas offers a single package with a setup fee of $500 and an annual payment of $100 for running the business.
- Setup: $500 one-time payment
- Annual: $100
Business Formation Services
New users will appreciate that LegalZoom offers a comprehensive service for the formation and incorporation of various types of entities.
You have the option to choose from various entity types, including LLC, partnership, C-Corp, non-profit, or DBA.
Not only that, unlike Stripe Atlas, startups can choose from 50 states where they want to form their enterprise.
It helps you get more options and flexibility in how to model your enterprise to match different states’ tax laws.
The customization options are also extensive, unlike Stripe Atlas, where entrepreneurs get to tweak their startup name, registered agent, and more.
Not only that, you can get extra services like trademarking a name and EIN registration.
However, one thing to note is that for DBA, startups cannot choose a different state apart from Delaware.
In contrast, Stripe Atlas offers two entity types, C-Corp and LLC in Delaware.
However, you have the flexibility to customize your brand name, stock issuance, directors, and other aspects.
The services also provide extra services like opening bank accounts with partner banks like Silicon Valley, Stripe accounts, EIN, and more.
However, unlike LegalZoom, Stripe Atlas formation services aren’t all-rounded.
You can only choose Delaware as the only incorporation state, and it lacks lifetime support.
✅ Winner: LegalZoom
Typically, the processing time for LegalZoom’s standard package can take up to 20 days.
This duration encompasses the time it takes for LegalZoom to file the paperwork with the state.
One thing to note is that, unlike Stripe Atlas, LegalZoom doesn’t include the government processing times.
Startups can wait up to 10 more days for states like California before they approve and issue the paperwork.
Unlike Stripe Atlas, LegalZoom offers expedited services where entrepreneurs can choose an express gold package priced at $349 + $100 CA state fees.
The package includes shipping in 1-2 days. Stripe Atlas offers processing times of 1-3 days in Delaware.
The duration is inclusive of government turnaround time. However, Stripe Atlas doesn’t offer an expedited service, unlike LegalZoom, because the processing times are unbeatable.
Not only that, Stripe Atlas doesn’t charge extra fees for shipping like LegalZoom.
✅ Winner: Stripe Atlas
Registered Agent Services and Costs
New users will find that LegalZoom offers registered agent services in all US states.
Not only that, entrepreneurs can even switch from other agent providers without charges.
Unlike Stripe Atlas, LegalZoom charges a flat fee of $249 annually for its RA service and doesn’t vary by entity or state.
If an entrepreneur chooses to pre-pay for 3 years, they get a discount of 10%.
The quality of RA offered by LegalZoom is top-notch. Once they receive a startup’s paperwork, they scan them within a day and send a notification to the client by phone or email.
From there, the service uploads the paperwork to their portal and ships the documents to the client’s address.
The compliance support offered by LegalZoom is also comprehensive. The service monitors tax report filing due dates and even sends alerts.
In some cases, they help clients file their taxes and provide the necessary legal forms. One thing to note is that LegalZoom doesn’t charge extra fees for its RA service.
Stripe Atlas also offers startup registered agent service, and it is part of its standard package paid in the setup $500 set up fee.
Stripe Atlas also charges an annual renewal fee of $100 for its RA service after the first year of incorporation.
Now, Stripe Atlas provides quality RA service, where, upon receiving client paperwork, they alert the client by email.
From there, they upload the paperwork to their portal and ship it to the client’s address.
Unlike LegalZoom, Stripe Atlas doesn’t provide adequate compliance support. Customers don’t receive notifications when due dates for filing tax returns are nearing.
They have to do it on their own.
✅ Winner: LegalZoom
Name Availability Search
You can access the name availability search tool directly from the LegalZoom homepage.
From there, entrepreneurs can enter their names in the search bar and pick a state and entity from the menu.
The platform then checks if the name entered is available. The tool recommends alternate names similar to your first choice if it’s unavailable.
The tool is accurate, and it uses up-to-date state databases. The service also conducts a countrywide trademark search on a business name to ensure it is trademark-free.
Whenever the name is unavailable, the tool generates a conflict report. In case the name is available, the platform provides a certificate.
Startups will find that Stripe Atlas doesn’t have a dedicated name availability search tool like LegalZoom.
During the application process, you have to enter your chosen name, and the service will then check name availability in Delaware.
Unlike LegalZoom, Stripe Atlas doesn’t state the accuracy and reliability of its name availability search tool.
The service says they only file the paperwork with the state using the customer’s chosen name unless unavailable.
Not only that, unlike LegalZoom, the service doesn’t recommend alternate names or ways to avoid trademark issues.
✅ Winner: LegalZoom
Online Document Access
LegalZoom provides all users with a portal to access their documents. All they have to do is log in to their account, and they can view, print, or download the documents.
Now, to ensure the security of the documents, LegalZoom encrypts the data and uses firewall and SSL tech.
Unlike Stripe Atlas, LegalZoom provides a compliance calendar to entrepreneurs for paperwork management.
It is a feature that allows you to track tax filing due dates, license renewals, and more. Not only that, you can request additional copies of your paperwork.
Stripe Atlas also provides you with access to your formation documents online. When an entrepreneur logs on to the dashboard, they can view, share, and download the paperwork.
Now, the servers where Stripe Atlas stores the documents are secure. The platform states it uses SSL encryption and a firewall.
However, unlike LegalZoom, customers cannot request additional copies or certificates of their documents.
✅ Winner: Tie
New users who may have doubts will find it reassuring that LegalZoom offers a 60-day money-back guarantee for their services.
The service will also grant credit for any orders made in the future. The refund policy applies to all services, such as real estate planning, trusts and wills, formation services, and more.
Objectively, the refund policy is generous, unlike Stripe Atlas, and it gives customers peace of mind when picking LegalZoom as their service provider.
In contrast, Stripe Atlas does not provide a money-back guarantee. Users are required to commit to their non-refundable one-time fee of $500, which does not cover recurring charges.
Despite this, startups do receive certain benefits. One is a $500 cashback when you deposit $10K to your Mercury bank account within 60 days.
It is not a significant refund, and it also depends on the partner who offers availability.
Unlike LegalZoom, it doesn’t give peace of mind to startups.
✅ Winner: LegalZoom
Navigating through the LegalZoom menu is simple, and finding a feature is easy.
The menu is clear, and entrepreneurs can pick from categories like trademarks and even view the subcategories.
The platform also has a search bar for finding a specific topic and a phone number in the top right corner.
Now, to use the services on the platform, LegalZoom provides clear instructions on formation, choosing an entity, and more.
Not only that, it only takes 15 minutes to complete the steps in the online application form.
Stripe Atlas also has an easy-to-navigate platform where you can locate a service on the dashboard.
The instructions you also find are clear and easily guide you through the onboarding process.
Completing the necessary steps is also quicker and more straightforward than with LegalZoom.
It takes just 10 minutes to fill out the online application form.
In contrast to LegalZoom, you gain access to financial integration with the Stripe gateway, which accepts over 100+ currencies.
Not only that, access to the Stripe network offers valuable discounts and benefits for growth.
✅ Winner: Stripe Atlas
Startups will find LegalZoom offers more customization options than Stripe Atlas. You can choose from more entity types and incorporate them from any of the US states.
Not only that, you get the option to continue or cancel the service within 60 days, unlike Stripe Atlas.
Now, unlike Stripe Atlas, you can customize the legal forms provided. One way is picking a business name, shareholders, registered agent, and more.
Not only that, entrepreneurs can add an extra service like trademark or EIN registration.
All users can also create an employee handbook outlining policies of their enterprise, like dress code, work from home, and more.
Stripe Atlas, on the other hand, service is more rigid and doesn’t give much room for customization.
You get to pick only one entity, C-Corp, and incorporate it in Delaware. Not only that, once an entrepreneur submits the paperwork, they cannot cancel or change the service.
Startups have a limited scope for customization, which includes the ability to personalize the splash screen for their card readers designed for accepting customer payments.
This customization allows you to upload your logo or choose from the templates provided.
✅ Winner: LegalZoom
Unlike Stripe Atlas, LegalZoom provides a compliance calendar that tracks and notifies startups on due dates for filing tax returns.
The information on the compliance calendar includes the tax filing requirements depending on business type and state.
Entrepreneurs can receive notifications by email or phone when the due date nears.
Unlike Stripe Atlas, businesses also get corporate record-keeping service that helps entrepreneurs update and maintain agreements, minutes, and more.
It enables startups to stay compliant and protect their owners. Stripe Atlas provides a tax reporting service where a 1099-K form gets generated and sent to the IRS and enterprise if it matches set criteria.
However, you have to use third-party services to track your due dates and other regulatory updates.
The platform only provides filing tools that startups can use to file annual returns.
Unlike LegalZoom, Stripe Atlas partners with leading accounting firms like PWC that provide free compliance consultations with startups.
✅ Winner: Tie
Users will discover that LegalZoom provides a wide array of services that are not as specialized as those offered by Stripe Atlas.
Entrepreneurs get a library of legal forms with customizable paperwork to fit various situations.
You can also use the document review service and have an attorney review the accuracy of the legal forms.
The service also provides an extensive attorney network that links startups to attorneys who specialize in varied fields.
From there, you can pick a plan that offers unlimited consultations and other services.
On the other hand, Stripe Atlas provides a niche-down service to startups and tech businesses.
As a Stripe Atlas user, you get a data incorporation service where startups launch their enterprises using other successful startups’ data.
Stripe Atlas also provides expertise through partnerships with companies like PWC and Harvard Business Services that offer solutions to startups.
✅ Winner: Tie
Customer Education and Resources
Startups will find that LegalZoom offers a more extensive set of educational resources compared to Stripe Atlas.
They provide legal articles written by experts, offering valuable insights, tips, and practical examples on various topics such as trademarks, taxes, and more.
New users will also discover an FAQ section that addresses common challenges faced by startups during their launch.
In addition, there is a webinar featuring experts discussing best practices in entrepreneurship.
Stripe Atlas has a blog where experts share their knowledge on funding, growth, and more topics.
However, unlike LegalZoom, the guides are not in-depth and don’t link to other tools or sources.
✅ Winner: LegalZoom
You can reach customer support on LegalZoom through phone, ticket, and email.
The response time for a phone call is 6-10 hours, and email is 24 hours. Unlike Stripe Atlas, the service includes a dedicated representative or even an attorney.
Stripe Atlas provides entrepreneurs with tickets and email as the only form of reaching out.
The response times can take up to 24 hours, which can be inconvenient for emergencies.
Unlike LegalZoom, Stripe Atlas does not offer a dedicated representative. As a new user, you are required to work independently or rely on the available guides during the formation process.
✅ Winner: LegalZoom
LegalZoom offers three packages: Basic, Pro, and Premium. The plans are pay-as-you-go and come with a money-back guarantee of 60 days.
The plans include Basic: $0 + state fees, Pro: $249 + state filing fees, and Premium: $299 + state filing fees. Unlike Stripe Atlas, LegalZoom doesn’t have a one-time setup fee.
Stripe Atlas charges a setup fee of $500 and a recurring annual fee of $100 after one year of formation.
Unlike LegalZoom, the charges are lower and do not include state fees or third-party services.
However, it lacks a free plan and a money-back guarantee.
✅ Winner: LegalZoom
LegalZoom packages are scalable, where a startup can upgrade to a higher plan to access other services.
The plans are designed to accommodate startups of different sizes, industries, and stages.
They are particularly well-suited for entrepreneurs looking to establish multiple entities (LLC, C-Corp, or partnerships) and require assistance with the incorporation processes.
Stripe Atlas also doesn’t provide scalable plans, so you only have the annual payment services.
It suits venture-backed startups that only need to form a C-Corp in Delaware and don’t require extensive support.
Standout Features of LegalZoom
You’ll be pleased to discover that LegalZoom offers a comprehensive range of services beyond formation and incorporation.
Here are several of these services that set it apart from Stripe Atlas.
It’s a network that becomes available to you once you subscribe to the service.
As a LegalZoom user, you gain access to unlimited consultations and have your paperwork reviewed by professional attorneys from various industries.
It is a service that allows startups to get personalized legal guidance for their enterprise.
Entrepreneurs get the option of creating a custom employee handbook outlining the business policies.
The guidelines can include the staff’s dress code, conduct, discrimination, and more.
It comes in handy since it can protect your business from getting sued.
Standout Features of Stripe Atlas
The service provides more specialized services for business formation. Here are some standout features that it offers startups that LegalZoom lacks.
Stripe partner benefits
It is a feature that allows startups to access the Stripe network of expertise and other products like the payment gateway.
The platform opens opportunities for startups to get funding from investors or even get endorsements from Stripe partners.
Not only that, access AWS, PWC consultations, and more.
Stripe gateway integration
Once a startup pays the one-time setup fee, it gets access to the financial tools of Stripe.
The first one is the payment gateway that accepts over 100+ currencies globally.
Other benefits include Stripe products like corporate cards, billing, and capital that are suitable for ecommerce businesses.
LegalZoom vs. Stripe Atlas: SMB Guide’s Verdict
Our comparison of LegalZoom and Stripe Atlas demonstrates that both services offer solid support for startups in the process of forming and incorporating a business.
Each service provides something unique that matches a specific business type, whether it’s in the pricing, processing times, entities, and more.
However, after the comparison, LegalZoom comes out as the winner, and here is why.
Startups will find a scalable pricing package and dependable compliance assistance.
The service also provides startups with a network of attorneys from different industries and a library of legal forms.
Not only that, startups get the option of creating an employee handbook outlining the policies for their enterprise.
A combination of all these services and the longevity of the company formed in 2001 make it edge Stripe Atlas.
Stripe Atlas is an excellent alternative, offering a fast and simple service for entrepreneurs looking to form a C-Corp in Delaware.
The service provides decent services like integration of the Stripe tools that offer valuable benefits like the payment gateway and investor endorsement.
However, the lack of a native name availability search tool, money-back guarantee, and only one entity type makes it lose to LegalZoom.
You’re seeking a service that provides flexibility in package features, offers a variety of entity types, and includes personalized legal consultations from a network of attorneys, then LegalZoom may be the right choice for you.
Choose Stripe Atlas If
You want to form a C-Corp in Delaware and need investors’ endorsements, but at a premium, one-time setup fee of $500.