LegalZoom Has a New Business Model
LegalZoom® which started as a legal document web site based on individual transactions is gradually shifting towards a new business model based upon recurring revenue.
Under the guidance of Premira, a private equity fund and now the majority shareholder of LegalZoom®, the company has launched a legal plan that adds legal advice to the purchase of its documents. Premira, is a specialist in helping companies create recurring revenue streams, it’s most recent success being Ancestry.com.
The Legal Service Plan business model is the future for LegalZoom®. A network of lawyers in every state has been created with capability of providing legal advice both for personal documents and business documents.
Here is the message by LegalZoom® about what you get when you purchase a Wills package bundled with legal advice:
“Membership includes: 30-minute phone consults with independent attorneys on an unlimited number of new legal matters. Attorney review of any completed LegalZoom documents. FREE revisions for as long as you maintain your membership. 10% OFF future LegalZoom purchases.
The price for the LegalZoom® estate planning package is $149.00, which includes a Will, Power of Attorney, and Living Will. This is a good value proposition for the consumer, if the client’s estate requires no complicated tax planning or has special circumstances that need to be incorporated into the documents. For a large percentage of U.S. consumers this set of estate planning documents will satisfy their needs.
I hear from lawyers occasionally that they make a business of cleaning up documents purchased from LegalZoom®. I don’t believe it. I think it is just defensive talk by lawyers who convince themselves that they offer a superior service, but at a much higher fee. Maybe this comment refers to documents purchased without legal advice and review, but I doubt it will apply to the enhanced service that now includes legal advice. Solos and small law firms will find it hard to compete against this value proposition unless they learn some lessons from LegalZoom®.
Lawyers can Learn from LegalZoom®
Solos and small law firms can learn from LegalZoom®. Ignoring Legalzoom’s approach to the marketplace will cause a continued decline in solo and small law firm income.
advertising and representations about legal services.
Note: LegalZoom® is a trademark of LegalZoom, Inc.