Companies like LegalZoom, Rocket Lawyer, Mama Bear, and ZenBusiness promise fast and inexpensive access to legal forms. They cut out the “middleman”—in this case, an attorney—to keep costs down. These DIY legal services allow people to do everything from filing for divorce to creating a will to incorporating a business. But do these companies do more harm than good?
One Size Does Not Fit All
DIY legal companies sell basic forms that apply to many, but not all, circumstances. The problem with using fill-in-the-blank forms when starting a business is that every situation is unique. What may be a simple filing for most businesses may not be for yours. Without legal counsel, all you can do is cross your fingers and hope you’re doing the right thing.
Business law is complex, and an attorney is more than a middleman that files paperwork. Startup & Business lawyers know many of the pitfalls, ins and outs, and nuances of starting a business. They’ll ask the right questions to get at the information you wouldn’t have thought was important. Experienced attorneys almost always see the big picture, and that’s something a simple form can’t do.
All too often, these forms can be filled out with wording that is potentially detrimental to a business. An experienced attorney is trained to read legal forms in a way that a layperson can not—with an eye for language that will be ambiguous or vague in the court of law. A business lawyer will make sure loopholes are closed and your paperwork is rock solid.
You Don’t Know What You Don’t Know
Rocket Lawyer’s website has a chart that explains the differences between the different types of business entities. Any lawyer will tell you that while a chart is a good place to start, it doesn’t even begin to give you the full picture. To summarize business entity information in this manner is overly simplistic.
An attorney will discuss your business plans (both now and for the future), taxes, your business’s ability to grow, and how you can raise capital. These are just some of the items to be considered. Selecting the wrong type of entity could turn out to be expensive and limit your choices down the road. Having to “clean up” problems, later on, could cost you money and your business’s reputation.
These DIY Companies Sell Free Content
Many of these DIY legal services charge you for forms that you can get for free elsewhere. What they do is pair these free forms with services you may or may not need, and then charge for the “package.”
While these companies don’t explicitly state so, by charging they make it seem like you can only get legal forms through them or an attorney. The Small Business Administration and your state’s Department of Revenue will probably have the same forms you can print off and review, free of charge.
The Benefits of Bringing in an Attorney at Startup
Chances are good that you will need a business lawyer at some point in the future. When you bring in an attorney at the very beginning of your business, you are establishing a long-term relationship. They’ll know the history of your business and your plans for the future. Having an ongoing relationship with an attorney is better than scrambling for one in a time of urgency.
Between our flat fee startup packages and our monthly subscription services, the Law Office of Elliott J. Brown can grow with your business and fill in the legal gap between incorporation and first in-house counsel hire. Give your business a strong foundation. Protect your assets, your ideas, and your investors; skip the DIY paperwork and give us a call today.