LegalZoom vs Stripe Atlas

Features, pricing, and contract terms compared

Patrick Ward Patrick Ward Follow Published: Sep 27, 2022

LegalZoom is focused on providing the legal tools that a business owner is likely to encounter in their every day lives. With a strong tilt towards domestic SMB, LegalZoom is preferable for those entrepreneurs requiring a suite of attorney-type services without the attorney-type costs. Stripe Atlas, on the other hand, is more focused on speed to market for International Founders, helping them start a compliant business within the U.S. as swiftly as possible.

Content on this page does not constitute financial advice. It is intended for general information purposes only.

LegalZoom

3.4/5 stars

LegalZoom and Stripe Atlas both aim to simplify the complex, but LegalZoom's approach to that question is to provide choice. Specifically, trying to cater to an SMB or single-person entrepreneur with a one-stop-shop of legal services that they would need both professionally, like business formation, and personally, such as family law and estate planning.

Stripe Atlas

3.2/5 stars

Stripe Atlas, in contrast to LegalZoom, leads the prospective entrepreneur to a one-size fits all product - incorporating your Startup in Delaware. Ideal if you are an International Founder looking to break into the U.S., but not as relevant if your situation doesn't exactly match that narrow definition.

Summary of key differences

FeatureLegalZoomStripe Atlas
Entry price$79 + state fees$500
Standard processing time20 business days1-3 business days
Foreign qualification fee $229 Not offered

Pricing Analysis: LegalZoom vs Stripe Atlas

LegalZoom's price point consistently puts it on the higher end of the DIY market, although they finally are able to undercut a competitor with Stripe Atlas. LegalZoom's standard package is $79 + state fees, considerably less than Stripe Atlas' eyewatering $500 one-time charge, inclusive of state fees. Stripe Atlas makes up for it on the backend with LegalZoom charging a prohibitive $299 for an annual registered agent renewal fee compared to Stripe Atlas' much more reasonable $100 for the same service.

LegalZoom pricing

The base pricing from LegalZoom is more expensive than Stripe Atlas. However, note that pricing is impacted by state fees. For example, LegalZoom customers setting up an LLC in Delaware will see an initial cost of $169 (package cost plus the state LLC fee). In Wyoming, the same package would cost $279 because of the higher state fee.

Stripe Atlas pricing

Stripe Atlas is the less expensive formation service offering compared with LegalZoom.

LegalZoom vs Stripe Atlas market value analysis

Market average based on analysis of 9 formation services providers.
MetricMarket AverageLegalZoomStripe Atlas
Lowest package price$156 before state fees$79 + state fees$500
Formation processing time9 business days20 business days1-3 business days
Registered agent annual cost$152 $229 Not offered

User experience & onboarding

Onboarding for LegalZoom aims to demystify legal services with respect to business formation. Optionality is built-in to the flow with micro-chat questionnaire to help business owners determine the right type of business formation along with options to pick from a set menu with transparent pricing. Add-ons populate throughout the onboarding, but given the transparent pricing up front, it isn't a surprise to any prospective business owner.

Onboarding for Stripe Atlas is dependent on a major factor: whether or not you have a Stripe account. Assuming you do, the process is fairly simple - after all Stripe Atlas really only has a solitary option: to become a Delaware Incorporated Company. Given the simplicity of the product, and all of Silicon Valley conventions behind it, Stripe Atlas is fairly painless when it comes to onboarding.

LegalZoom is often held to a high standard for onboarding, and this doesn't change with a quick and easy experience for a business owner, helping them decipher between multiple seemingly similar legal documents. Stripe Atlas, with a solitary product line, would generally have the win here on onboarding over LegalZoom, and indeed once you get into the onboarding flow, Stripe Atlas is hard to beat. However, it's worth noting LegalZoom makes it slightly easier to enter the initial flow, not incurring account creation, compared to Stripe Atlas which insists on a Stripe account creation step first before signing up for the product.

Formation speed

LegalZoom tends to stray from the promise of tech with its slightly lethargic processing times of twenty business days. Stripe Atlas, by contrast, in true tech-forward fashion, simplifies their product order flow so much that it enables them to deliver swift 1 to 3 day business formation speeds to their International Founder clientele.

LegalZoom's twenty business day processing time is in the highest range for formation services. When compared to lawyers in general, this speed might seem swift, and indeed their services are indicative of the 'legaltech' market that reduces the cost of traditionally expensive legal advice. However, their formation speed is not up to scratch when compared to Business Formation-specific services that promise processing in a handful of days.

Stripe Atlas, as is expected for Silicon Valley tech, tends towards the swift processing times that have become industry standard. Ranging from one to three business days, Stripe Atlas is good at getting your Delaware-based company up and running fast.

Are they worth the cost?

LegalZoom is geared towards both the SMB and Solopreneur markets, with a strong emphasis on the individual business owner themselves. Their positioning is indicative of trying to be a one-stop-shop for businesses that have legal needs but are fearful of the costly retainers incurred by an in-house counsel or legal contractor. LegalZoom's products look to cover the breadth of what an SMB or Solopreneur business owner would need - not only professionally such as formation, trademarks, and ongoing contracts, but also personal with products for estate planning, family law, and real estate.

Backed by the tech conglomerate that is Stripe, the target of Startups is fairly explicit for Stripe Atlas. The two key personas are either International Founders looking to start a tech business in the U.S. (given Stripe's strong emphasis on social proof from 140 countries) and Startups that looking towards fundraising, specifically VC and Private Equity, or joining an accelerator. The message is clear - if you're looking to be the next Silicon Valley Unicorn, Stripe Atlas wants you.

NanoGlobals editor's rating for LegalZoom reflects its comprehensive nature of legal services for an aspiring business owner. LegalZoom earns points for being more cost-efficient than regular attorney services along with ease of onboarding via chat and helpful introductory flows to their products. Unfortunately, they miss the mark on pricing and processing times when compared to the industry average, outweighing any perceived advantage of being legal experts since, like with all services in this formation niche, their recommendations don't constitute legal advice.

With all the hype around Silicon Valley Unicorns, NanoGlobals editor's rating for Stripe Atlas might seem surprising at first. They are one of the more straight forward products in the business formation space and are clear on who they serve. But, as with many in Silicon Valley, they overcharge substantially due to the gloss of 'new age tech' - a gloss for a fairly simple product that seems to be a clear revenue grab for Stripe because they can lean on their brand's clout. The other big detraction for Stripe Atlas is the implied restriction on how you run your business - it has to be 'Stripe-friendly' and they quickly enmesh your business into their network, leading to a potential lack of operational flexibility.

Author Credentials

Patrick Ward is an expert on working with startups and new businesses. He has 8 years experience serving tech-enabled companies with staffing and growth.

Bio & Contact →