What changed in this filing

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Item 1. Business

2024-02-29 compared with 2023-03-01 · 144 added, 148 removed, 114 unchanged (72% of the section changed)

Our mission is to democratize law.

We believe every business deserves the full protection of the legal system and a simple way to stay compliant with it.

Our platform helps new businesses form.

Once a small business is formed, we offer subscription services to protect the business, its ideas, and the families that create them.

LegalZoom empowers small business owners to apply their energy and passion to their businesses instead of the legal and regulatory complexity required to operate them.

LegalZoom is a leading online platform for legal and compliance solutions in the United States, or U.S.

Our unique position at business inception allows us to become a trusted business advisor, supporting the evolving needs of a new business across its lifecycle.

Along with formation, LegalZoom offerings include ongoing compliance and tax advice and filings, virtual mailbox solutions, trademark filings, and estate plans.

We operate across all 50 states and over 3,000 counties in the U.S., and have more than 20 years of experience navigating complex regulation and simplifying the legal and compliance process for our customers.

LegalZoom is a leading online platform for business formation in the United States, or U.S.

Our unique position at business inception allows us to become a trusted business advisor, supporting the evolving needs of a new business throughout its lifecycle, and we have expanded our platform to include professional expertise and other products, both legal and non-legal, to better meet the needs of small businesses.

Driven by a mission to unleash entrepreneurship, we deliver comprehensive legal, tax, accounting and compliance products and expertise to millions of small business owners and their families through easy-to-use technology.

We operate across all 50 states and in over 3,000 counties in the U.S., with over two decades of experience in simplifying the legal and compliance process for our customers and empowering entrepreneurs with services that help to make their dream a reality.

The LegalZoom Ecosystem

Millions of people in the U.S.

start small businesses every year.

Many small businesses operate without forming a legal entity, unintentionally introducing financial risk to the owners’ personal assets.

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Once they understand the need to be protected, they often do not know what to do, where to turn or how much it will cost to get help.

Even when formed properly, small businesses often fail to comply with ongoing compliance requirements, thereby reintroducing personal liability or facing significant financial and operational risk.

Furthermore, these difficulties are becoming more acute as the number of U.S.

business formations increase, driven by various macroeconomic factors such as the rise of the gig economy and remote work, accentuating the need for a trusted, cost-effective, digital-first and simple legal and compliance solution.

Our platform combines the power of technology and people to demystify and simplify complicated processes, creating user-friendly experiences for our customers.

Further, even when formed properly, small businesses often fail to comply with ongoing compliance requirements, thereby reintroducing personal liability or facing significant financial and operational risk.

These difficulties are becoming more acute as the number of U.S.

business formations increases, driven by various macroeconomic factors such as the rise of the gig economy and remote work, accentuating the need for a trusted, cost-effective, digital-first and simple formation and compliance solution.

Our customer funnel.

We believe we earn small businesses’ trust and drive significant organic traffic through our brand name recognition and reputation, as well as our free proprietary educational content, which is often our first interaction with a potential customer.

This content includes our Article Center and free access to over 160 attorney-drafted forms.

From there, our small business customers’ initial purchase is typically a business formation product that streamlines the process of starting a business.

As of December 31, 2023, we had formed over 4.1 million businesses since our inception.

Our position at business formation gives us unparalleled knowledge of our customers’ needs, often times prior to the business being operational or discoverable by other service providers.

We leverage this valuable knowledge and our position as a small business’ first advisor to introduce our customers to the most relevant business solutions to help them manage other aspects of their business.

As a result, our customers often purchase a mix of transaction and subscription offerings alongside and after the initial formation transaction in order to solve additional legal, compliance and business management needs, deepening our relationship with our customers.

For example, after forming their business entity, our customers can opt to register their company name and/or logo as a trademark or sign up for a business advisory subscription to receive additional legal support for their small business needs.

Additionally, as forming a company is an important life event, some of our small business customers opt to purchase an estate plan offering when they form their company.

The recurring revenue gained through subscription services and additional purchases from existing customers during the lifecycle of their business allows us to increase customer lifetime value.

See below under “Our Products and Services” for additional information regarding our transaction products and subscription offerings.

Our technology platform.

Our technology platform combines the power of technology and people to demystify and simplify complicated processes, creating user-friendly experiences for our customers.

Our proprietary technology enables us to automate many complex legal and compliance processes, allowing us to offer solutions at transparent, flat-fee prices that are at a significant discount to traditional offline alternatives.

While the majority of our customers complete these transactions without human assistance, many prefer to have some guidance through the process.

The combination of technology and people is at the heart of our unique customer experience.

For our customers looking for general help, our customer care and sales organization is available for real-time guidance on how to use our services.

For customers preferring credentialed assistance, we embed the option for them to retain attorneys and certified public accountants, or CPAs, from the beginning of the customer journey.

In addition, our unique and trusted position at business formation gives us unparalleled knowledge of our customers’ needs prior to the business being operational or discoverable by other service providers.

We leverage this valuable knowledge and our position as a small business’ first advisor to introduce our customers to the most relevant business solutions within our partner ecosystem to help them run other aspects of their business.

We believe we earn small businesses’ trust and drive significant organic traffic through our free proprietary educational content, which is often our first interaction with a potential customer.

From there, our small business customers’ initial purchase is typically a formation product that streamlines the process of starting a business.

Alongside and after this initial transaction, our customers generally purchase annual subscription services to solve additional legal, compliance and tax needs, deepening our relationship with our customers.

With recurring revenue through subscription services and repurchases from existing customers, we continue to benefit from an increasing customer lifetime value.

Industry Trends

Millions of people start small businesses every year, a trend driven by digital enablement and the gig economy.

Small business owners often do not know that they may face personal liability and tax consequences depending on their business formation decision and many try to figure out legal requirements on their own, often facing regulatory problems for noncompliance.

It can be frustrating, time consuming and expensive to navigate multiple layers of legal and compliance requirements.

There are structural impediments that make traditional offline attorneys unable to adapt to consumer behaviors and technology advancements.

While service industries like accounting, tax, marketing and payments have rapidly transitioned online, legal offerings largely remain offline.

Online adoption of legal services lags behind other comparable industries.

The gap between a small business owner’s legal and compliance needs and available offline solutions is widening.

The challenges associated with traditional offline “do it yourself” or “find an expert” options are becoming relatively worse as service level expectations increase as a result of small business

enablement in other industries.

Technological advances are transforming consumer expectations for professional services.

The combination of technology and people is at the heart of our customer experience.

See below under “Our Technology” for additional information.

We offer customers ongoing access to experts to help handle complex matters, including through a network of independent law firms and an in-house team of certified public accountants, or CPAs, and enrolled agents.

As of December 31, 2023, we had over 1,000 attorneys in our independent attorney network.

Our independent attorney network provides customers access to attorneys licensed in their jurisdiction and experienced in the types of legal matters that impact small businesses at a significant discount to traditional offline alternatives.

Our attorneys benefit from participating in our network as we handle the customer lead generation, as well as the scheduling and billing of the initial customer consultation.

From there, the initial customer consultation serves as a platform for business development, where the participating attorney can offer to provide billable legal services to our customers at discounted rates.

In addition, participating law firms can leverage our brand awareness, as well as the customer feedback and testimonials, to market their own practice.

We also have an in-house team of CPAs and enrolled agents that are critical to our tax offerings.

We offer our customers access to this in-house team of CPAs and enrolled agents to provide tax preparation and filing support for federal and state returns.

In addition, since September 2021, one of our U.S.

subsidiaries operates as an alternative business structure, or ABS, in Arizona, which allows us to provide cost-effective legal services to our customers.

Currently, our ABS primarily supports our intellectual property business, and its experienced attorneys help guide customers through the trademark registration process.

During the year ended December 31, 2023, our ABS attorneys filed over 14,000 trademark applications with the U.S.

Patent and Trademark Office.

Our legal and tax services are provided across all 50 states in the U.S.

Our partners.

We have insights into our customers and leverage our product as a channel to introduce small businesses to a variety of third party partners in our partner ecosystem.

Our third party partners are leading providers of complementary small business services that extend beyond our core offerings such as banking, credit cards, website design, and payment processing, among others.

Our Competition

We operate in a very competitive industry.

We face intense competition from offline law firms and attorneys, online legal document services, legal plans, secretaries of state, tax preparation companies and other service providers.

Law firms and solo attorneys, who provide in-person consultations and are able to provide direct legal advice that we generally cannot offer due to laws and regulations regarding the unauthorized practice of law, or UPL, compete with us offline and have and may develop competing online legal services.

However, we previously applied for and received a license to operate as an alternative business structure, or ABS, in Arizona, which allows corporate entities to become licensed providers of reserved legal activities in that jurisdiction.

As a result, our Arizona ABS is able to compete directly with more traditional offline law firms and solo attorneys.

We also compete in the registered agent services business with several companies that target small businesses.

In addition, certain U.S.

states, including Nevada, California and Louisiana, offer online portals where consumers may file their articles of organization for free, other than filing fees.

Our direct and indirect competitors, whether they are online legal document providers, legal plan providers, law firms, accounting firms, solo attorneys or large internet providers, may also be developing innovative and cost-effective services that target our existing and potential customers.

In recent years, we have seen certain online competitors target more price conscious customers by offering business formation transactions at little or no charge while cross-selling subscription compliance services.

We expect to face increasing competition from offline and online legal services providers in our market, and our failure to effectively compete with these providers could result in revenue reductions, reduced margins, and loss of market share, any of which could materially and adversely affect our business, results of operations, financial condition and future prospects.

We believe competitive factors for our services include ease of use, breadth of offerings, brand name recognition, reputation, price, quality and customer service and that we compare favorably on all these bases.

We are in the early stages of penetrating and growing the online market for small business legal and compliance services.

We expect to continue to grow our customer base and retain and expand our customer relationships following formation with the following strategies:

Grow our customer base.

We continue to grow the top of our funnel and improve our customer experience in order to grow our customer base.

To accelerate growth, we intend to continue to invest in our brand to increase awareness of the protection that legal and compliance services offer small businesses, and the ease and affordability of our platform.

We also intend to broaden our customer top of funnel through the introduction of lower-priced products and services targeting more price-sensitive customer segments.

Finally, we continue to partner with leading brands that can help our small business customers and improve our partner ecosystem.

We operate in a very competitive industry, and the competitive landscape in which we operate is constantly evolving as we move into new markets and expand our ecosystem.

As a result, we compete with a variety of companies and government entities, including the following:

• online business formation providers and registered agent service providers;

• traditional offline law firms and solo attorneys, online legal document services and secretaries of state;

• accounting and tax firms and other tax preparation and filing service providers;

• large platform companies that could develop competing technology solutions to address the needs of our small business or consumer customers.

Law firms and solo attorneys, who provide in-person consultations, are able to provide direct legal advice that we generally cannot offer due to laws and regulations regarding the unauthorized practice of law, or UPL.

However, our ABS in Arizona is allowed to provide independent legal advice to our customers and, as a result, can compete directly with traditional offline law firms and solo attorneys.

In addition, there are structural impediments that make it difficult for traditional offline attorneys to adapt to technology advancements and consumer behaviors.

While service industries like accounting, tax, marketing and payments have rapidly transitioned online, legal offerings largely remain offline and online adoption of legal services lags behind other comparable industries.

However, some traditional offline attorneys have developed and may continue to develop competing online legal services.

We expect to face increasing competition from offline and online service providers in our markets.

For example, in recent years, we, along with some of our online competitors, began to target more price conscious customers by offering business formation transactions at little or no charge while cross-selling compliance and other business services.

Our failure to effectively compete with our competitors could result in lower revenue, reduced margins, and loss of market share, any of which could materially and adversely affect our business, results of operations, financial condition and future prospects.

We believe the primary competitive factors on which we compete include ease of use, breadth of offerings, brand name recognition, reputation, price, quality and customer service.

We believe we compare favorably on all these bases and our ability to remain competitive will largely depend on our ongoing performance in these areas.

We are in the early stages of penetrating and growing the online market for legal, compliance and business management solutions.

We aim to continue to grow our customer base and retain and expand our customer relationships with the following strategies:

Scale the business.

We continue to grow the top of our customer funnel in order to expand our customer base.

To broaden the top of our customer funnel, we have introduced and may continue to introduce lower-priced products and services targeting more price conscious customers.

We intend to maintain our brand leadership by delivering a quality product and user experience, leveraging our strong brand awareness and lower-priced offerings to drive traffic to our website and through targeted marketing investments.

As we attract more visitors to our website, we believe that we have a large opportunity to increase conversion of prospects into customers.

Retain and expand our customer relationships following formation.

As we innovate for small businesses, we aim to become their trusted partner for life.

In order to do this, we intend to:

• Launch adjacent services.

Our strategy is to meaningfully expand our product line to offer a solution for the majority of small business legal and compliance needs.

• Partner to offer our customers broader ecosystem solutions.

We plan to offer additional access to third-party solutions to further support small business needs in areas such as banking, payments, payroll, accounting, and website hosting.

• Increase customer lifetime value.

We plan to continue to improve the lifetime value of our customers, particularly by increasing retention of our small business subscribers through maintaining engagement post-purchase, adding new solutions to serve additional needs, and improving lifecycle marketing to increase retention rates.

• Increase our market opportunity by introducing a new tier of higher-value assisted offerings.

We aim to reduce peoples’ uncertainty and doubt about forming a business on their own by offering “assisted” solutions alongside our “do it yourself” offerings for their legal and compliance needs.

We plan to provide more value to our customers from existing product lines by adding a tier of attorney assisted solutions and continuing to expand our professional-assisted offerings to complement our technology-enabled solutions.

We will also continue to invest in further improving our customer experience, such as upgrading our mobile experience, in order to reduce friction and increase conversion across our existing products and services.

Build a business ecosystem .

As we innovate for small businesses, we aim to become their trusted partner during all stages of their business lifecycle.

We intend to provide more value to our customers during and post-formation by continuing to expand our ecosystem to include business management solutions that keep small businesses compliant, protected and financially organized.

Our strategy is focused on broadening our portfolio of new products and services and strategically deepening customer relationships, including in ways that will increase our recurring revenue through subscription offerings.

Since our initial public offering in June 2021, we have integrated five new services into our ecosystem:

our LZ Tax subscription service in July 2021, our LZ Virtual Mail subscription service in October 2022, an eSignature subscription service in April 2023, our LZ Books accounting solution subscription in August 2023 and a business licenses offering in November 2023.

As we grow our ecosystem, we aim to continue to improve the lifetime value of our customers by maintaining ongoing engagement post-formation and cross-selling our offerings.

We will also continue to strategically partner with leading brands that can improve our partner ecosystem by offering small business solutions outside of our core offerings.

Integrate experts.

We aim to provide our customers affordable access to expert advice.

Our expert offerings are higher-cost services that provide professional expertise to our customers as they navigate complicated legal and compliance processes.

Our expert offerings include attorney and CPA “assisted” solutions alongside our “do it yourself” offerings for legal, compliance and tax and personal needs.

We intend to continue to expand our professional-assisted offerings to complement our technology-enabled solutions and provide more value-added services to both our consumer and small business customers.

We aim to increase the consumption of our expert offerings by existing customers through targeted cross-selling and promotion of our products, as well as by improving the platforms through which our customers and experts interact.

We also aim to attract new customers to our expert offerings by enhancing and creating new top of funnel entry points to these offerings.

For example, our proprietary patent-pending artificial intelligence-powered document summarization tool, Doc Assist, and our newly revamped library of attorney vetted legal forms help drive traffic to our website and promote our expert offerings.

Our Products and Services

We help customers form their businesses, protect their ideas, stay compliant and scale their operations.

Our products and services include business formations, creating estate planning documents, protecting intellectual property, completing certain forms and agreements, providing access to independent attorney advice, and connecting customers with experts for tax preparation services.

The primary driver of new customers is small business formation transactions, and at that moment we aim to start a deeper relationship reflected in bundled subscription services and

partner offerings.

This combination creates a suite of legal and compliance solutions that are relevant for our customers’ ongoing needs.

We also have a partner ecosystem that enables us to offer third-party services to our customers and to offer our services to our partners’ customers.

Our transaction products and subscription services are designed to support the legal, compliance, and business management needs of small businesses and consumers.

Transaction products

Our transaction products are listed in the following table:

Our primary transaction products are listed in the following table:

Transaction Products for Small Businesses Transaction Products for Consumers

Business Formation

Limited Liability Company (LLC)

Limited Liability Company, or LLC

Incorporation of C and S Corporations

Nonprofit Formation

Doing-Business-As (DBA)

Doing-Business-As, or DBA

Corporate Changes and Filings

Business Licenses

Beneficial Ownership Information Report

Intellectual Property

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Provisional Patent Application

Patent Application

Business and Personal Tax Preparation

Consumer Estate Planning

Consumer, Estate Planning and Other

Last Will and Testament

Power of Attorney

Other Legal Matters

Real Estate Deed Transfer

Real Estate Leases

Subscription services

Our primary subscription services are listed in the following table:

At December 31, 2023, we h ad over 1.5 million subscription units outstanding.

Our subscription agreements generally have annual terms, while some have monthly terms.

Our primary subscription services

are listed in the following table, and a more detailed description of certain of our subscription services is provided below:

Small Business Subscriptions Consumer Subscriptions

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Attorney Advice through our Legal Plans

Tax Advice and Preparation

Accounting and Payroll

Virtual Mail and Check Deposit Services Attorney Advice through our Legal Plans

Tax Advice & Preparation

Virtual Mail and Check Deposit Services

Trademark Monitoring

Attorney Advice through our Legal Plans

Estate Planning Bundle

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Registered agent subscriptions .

In most states, a business entity, such as an LLC or corporation, is required to appoint and maintain a registered agent in its state of formation to receive service of process and official government communications.

The entity must disclose the address of its appointed registered agent and, in many states, the registered agent must be available during business hours.

In most states, small businesses are required to have a registered agent, which generally must be an adult or an authorized business that can receive mail or hand-delivered court documents at a physical address during normal business hours.

This requirement can be burdensome for many small businesses to handle on their own.

Our registered agent services receive, process, and forward served legal documents digitally or physically to the customer.

With our registered agent subscription, we serve as our customer’s registered agent:

accepting their documents through the mail, digitizing critical business documents, and alerting them of critical business documents or notices.

This serves to help them adhere to critical tax and annual report deadlines, among other benefits.

During the year ended December 31, 2023, we had staffed registered agent locations covering all 50 states.

Compliance subscriptions .

Our compliance subscriptions provide assistance with state-mandated regulatory filings, such as tax returns and corporate annual reports that are required to keep a business entity in good standing.

The subscription plans also monitor the status of our customers’ businesses with certain state agencies and provide alerts to notify them if they fall out of good standing as well as to stay abreast of important deadlines.

Our compliance subscriptions provide assistance with state-mandated regulatory filings, such as corporate annual reports that are required to keep a business entity in good standing, as well as certain federally-mandated filings, such as the beneficial ownership information report required as of January 2024 by the U.S.

Federal Crimes Enforcement Network.

These compliance subscription plans also monitor the status of our customers’ businesses with certain state agencies to help customers stay abreast of important deadlines and to provide alerts to notify them if their business falls out of good standing.

Attorney advice subscriptions .

For small businesses and consumers seeking legal advice, we offer subscription legal plans that provide access to independent attorneys in all 50 states.

These subscriptions also include other benefits, such as access to legal forms, discounts on additional legal services offered by the network attorney, and, in some cases, an annual checkup with the network attorney for estate planning purposes.

We also offer attorney advice subscription packages that include other benefits, such as the ability to edit and electronically sign forms from our attorney-drafted legal forms library, discounts on additional legal services offered by the network attorney, and, in some cases, an annual checkup with the network attorney for estate planning purposes.

Tax subscriptions .

We introduced our LegalZoom-fulfilled tax subscription, or LZ Tax, in October 2020.

This subscription includes tax advice on essential tax matters at both state and federal levels with the option to add tax preparation, as well as advice from a tax expert, either a CPA or an enrolled agent.

In addition, our customers receive

a consultation included in their formation that includes guidance on their tax strategy, including how to maximize their deductions and income.

Our tax services help small businesses get set up right from the beginning to minimize their tax bill.

Legal forms and other subscriptions.

We offer other subscriptions, including unlimited access to our library of legal forms, electronic storage of applicable LegalZoom documents, and document revisions.

Through our acquisition of Revvsales Inc.

in October 2022, we plan to enhance our forms library and legal template offerings and integrate e-signature capabilities into our platform.

Additionally, we offer subscriptions that enable customers to monitor trademark applications, create meeting minutes for their board of directors’ meetings and monitor compliance calendar deadlines.

Our subscription agreements generally have annual terms, while some have monthly terms.

They are generally non-refundable during their term, including any renewal term, after a 60-day refund period at the beginning of the initial term and any renewal term.

They generally automatically renew at the end of each term unless notice of cancellation of the renewal is provided any time in advance of the renewal date.

We generally do not issue pro rata refunds outside of the applicable 60-day refund period.

Customers can cancel the automatic renewal on our website or by phone.

In the case of our subscriptions for registered agent services, the customer needs to appoint a new registered agent for its business in order to complete a cancellation.

Partner ecosystem

We have unique insights into our customers and leverage our product as a channel to introduce small businesses to our partner ecosystem, solving even more of their needs.

Our partnering arrangements include reseller models, revenue share, and flat fees earned by introducing small businesses to leading providers of small business services such as banking, credit cards, business licenses, website design, and payment processing.

In addition to serving small businesses and consumers, we offer a developer platform, including APIs that enable external developers to co-brand or white-label business formation and compliance services with a highly integrated solution.

Our enterprise segment customers include both large enterprises and small business platforms with a significant number of users.

Our solutions provide large enterprises the ability to manage their multi-entity legal and compliance needs and small business platforms to offer business formation and compliance services to their own customers, either within their own customer experience or by referring the customer to us.

New product development

Our product development strategy is focused on reducing friction and increasing conversion across our existing core products and services, expanding our portfolio of new products and services, gaining market share, and strategically deepening customer relationships, including in ways that will make legal and compliance expertise available to our customers and increase our recurring revenue through subscription offerings.

Our LegalZoom-fulfilled tax subscription, or LZ Tax, includes tax preparation and advice from a tax expert, either a CPA or an enrolled agent, on essential tax matters at both state and federal levels.

Our services include unlimited calls and messages with a tax expert, advice on self and employee payments and deductions, access to our LZ Books accounting solution, quarterly tax estimates and federal extensions.

Virtual mail subscriptions.

The rise of the gig economy and the increase in remote work have resulted in an increasing number of small businesses operating out of a home or personal address.

Our virtual mail subscription, or LZ Virtual Mail, protects our customers’ personal information by providing an independent business address.

It also provides our customers flexibility by allowing them to check their mail from anywhere.

Our virtual mail services include mail receipt, sorting, digitization, check depository services, and shipment or storing of select mail.

Legal forms and eSignature subscriptions.

We offer other subscriptions, including unlimited access to our library of customizable legal forms, electronic storage of applicable LegalZoom documents, and document revisions.

We also offer eSignature subscriptions, which allow customers to upload their own documents or draft new documents using one of our attorney-drafted legal form templates and then sign and manage those documents online, all in one place.

Historically, our customers have tended to place a higher number of orders and entered into new or renewed subscriptions in the first quarter of the year, which is when we believe the demand for forming businesses is the highest.

Further seasonality is reflected in the timing of our revenue recognition in the second quarter, when we have typically recognized a high amount of revenue from orders placed in the first quarter but fulfilled in the second quarter.

Also, we have historically seen demand for our services decline around the beginning of the third quarter as a result of summer vacations and in the last two months of the fourth quarter as a result of the winter holidays.

While the seasonality of our business was impacted by the COVID-19 pandemic throughout 2020 and into 2021, we have since seen a return to more typical historical trends.

We have historically seen demand for our services decline around the beginning of the third quarter as a result of summer vacations and in the last two months of the fourth quarter as a result of the winter holidays.

Our Technology

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We believe that our proprietary technology is an important and valuable part of our business.

We protect this proprietary technology by relying on a variety of intellectual property mechanisms including copyright and trademark laws, restrictions on disclosure and other methods.

We protect this proprietary technology by relying on a variety of intellectual property mechanisms including copyright, patent and trademark laws, restrictions on disclosure and other methods.

We frequently file applications for trademarks and service marks in order to protect our intellectual property.

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and in foreign jurisdictions, as well as pending trademark applications in the U.S.

We have no issued patents.

We have no issued patents, but we have a patent-pending application in the U.S.

We also license intellectual property from third-parties, such as software used to support our technology and operations.

In addition, we seek to protect our intellectual property rights by requiring our employees and independent contractors to enter into agreements acknowledging that all works or other intellectual property generated or conceived by them on our behalf are our property, and assigning to us any rights, including intellectual property rights, that they may claim or otherwise have in those works or property, to the extent allowable under applicable law.

Our Attorney Advice Network

We offer attorney advice across all 50 states in the U.S.

to our subscribers through a network of independent law firms that manage relationships with independent attorneys.

Our brand and marketing efforts allow the participating attorneys to focus more on the practice of law and less on business development.

The initial consultation serves as a platform for business development, where the participating attorney can offer to provide billable legal services to our customers at discounted rates.

In addition, participating law firms can leverage our brand awareness as well as the customer feedback and testimonials to market their own practice.

Each firm receives a flat administrative fee from us for each legal plan participant in its area to cover the administrative costs associated with participating in our network.

Customer Care

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Sales and Marketing

We invest significantly to create a highly recognizable legal brand, online and offline and we attract a meaningful percentage of unpaid website traffic, underscoring our brand strength and unique content offering.

marketing includes educational initiatives such as our Article Center on our website, where we create content to better inform our customers on how they can plan for and protect themselves, their families, and their businesses.

We invest significantly to create a highly recognizable brand, online and offline and we attract a meaningful percentage of unpaid website traffic, underscoring our brand strength and content offering.

Our content marketing includes educational initiatives such as our Article Center on our website, where we create content to better inform our customers on how they can plan for and protect themselves, their families, and their businesses.

We use a strategic mix of online and offline marketing in combination with inbound sales.

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At December 31, 2023, we, together with all our subsidiaries, had 1,190 employees worldwide.

At December 31, 2022, we also engaged approximately 400 contractors and consultants in the U.S.

At December 31, 2023, we also engaged approximately 70 seasonal workers as well as 600 contractors and consultants globally.

None of our employees are represented by a labor union.

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We offer competitive compensation that we believe is aligned with the market and fair relative to our peers.

At LegalZoom, one of our core values is People First.

By that, we not only mean caring for and protecting the millions of customers we have served since inception, but investing in, empowering and fostering trust and wellness among our employees.

In order to better understand the needs of our employees, we launched a new employee feedback platform that allows us to survey our employees on a regular basis.

We were able to establish baseline employee net promoter, or NPS, and employee satisfaction scores, along with other feedback that measures satisfaction in a variety of areas.

We are now able to take very specific action based on the voice of the employee to better serve our organization.

At LegalZoom, our values are Lift Each Other Up, Champion Our Customers, See the Whole Picture, Focus on Results, and Keep It Simple.

These values shine through in all that we do to foster an inclusive and empowering culture, as we continue to focus on the well-being and success of our employees.

We monitor the state of our employees’ happiness with regular engagement surveys, open feedback forums, and action planning based on results.

We continue to see favorable engagement scores, particularly in overall satisfaction or OSAT, and Net Promoter Score, or NPS, when our employees are asked the likelihood of recommending LegalZoom as a great place to work.

We have remained agile to accommodate the ever-changing needs of our employees since the pandemic.

In 2021, we announced the adoption of our remote first model, which required coordinated efforts across the organization to operationalize.

Over the last year, our strategy has been focused on engaging employees virtually to support working from home by launching virtual productivity and collaboration tools, and driving engagement through virtual events.

In addition, while they remain primarily remote, we engaged with corporate employees who are located near our existing offices to enable them to leverage offices for in-person meetings where live collaboration could help foster improved productivity and engagement.

To facilitate this, in the summer of 2022, we re-opened our Glendale, California, and Austin, Texas, locations to our remote first teams, creating intentional collaboration spaces that would enable in-person working sessions and team engagement.

We also opened a new location in Mountain View, California and Playa Vista, California, where we had a large cluster of employees residing, to have a space where our remote first teams could have the opportunity to engage with their co-workers in person.

In 2021, we adopted our remote first model, which required coordinated efforts across the organization to operationalize.

Since then, our strategy has been focused on engaging employees virtually to support working from home by launching virtual productivity and collaboration tools, and driving engagement through virtual events.

We utilize our office locations in Los Angeles, CA, Mountain View, CA, Austin, TX, Beaverton, OR, and Frisco, TX for engagement events, in-person meetings, team offsites, and more to build connection and productivity.

This approach has allowed us to build foundational infrastructure and establish a stronger culture both virtually and in-person.

We have also invested in employee engagement to help improve connectedness in our remote-first work environment.

In 2022, we launched an employee recognition tool that rewards and provides visibility to our employees’ accomplishments.

We also continue to fuel our organization’s passion for social good, and launched a new employee giving program and tool that provides dollar-for-dollar matching and paid time off or volunteering for causes our employees care about most.

Finally, we continue to engage our employees in in-person and remote social impact events, like our second annual Impact Week, where we come together to volunteer and raise funds for various causes.

In 2023, we refreshed our employee recognition program that rewards and provides visibility to our employees’ accomplishments.

We also continue to fuel our organization’s passion for social good, with our employee giving program and tool that provides dollar-for-dollar matching and paid time off for volunteering.

Finally, we continue to engage our employees in in-person and remote social impact and Employee Resource Group events, like our annual Impact Week, where we come together to volunteer, learn about causes, and fundraise.

In 2023, we remained committed to our principles of taking care of our employees holistically while continuously looking for ways to improve our overall benefits offering.

We offer competitive benefits including:

100% employer-paid medical, travel reimbursement for out-of-state procedures, dental and vision plans, fertility coverage, mental health coverage, physical wellness, and paid-time off, including a continuous week off, called Wellness Break for all employees.

In addition, we made a number of meaningful enhancements in 2022’s November Open Enrollment for 2023, including increasing our offerings on mental health and parental leave for non-birthing parents, additional gender equality benefits, additional sick-time off and paid company holidays, and new lifestyle benefits for our employees to use in a way that represents them and expanding coverage on our dental and vision plans.

100% employer-paid medical, travel reimbursement for out-of-state procedures, dental and vision plans, fertility coverage, mental health coverage and workshops, physical wellness, lifestyle benefits, paid-time off,

and 401k match.

In addition, we made a few meaningful enhancements in 2023’s November Open Enrollment for 2024, including extending mental/physical wellness benefits to dependents, increasing flexibility to bonding leave for new parents, additional sick-time off and paid company holidays, as well as enhancing coverage on our dental plans.

We believe we are thriving when every voice is nurtured and heard.

We have six employee resource groups today, including Pride Zoomer Alliance Network, Lift Every Voice Black Network, RiseUp Women’s Network, Women in Tech Network, and Nos Unimos LatinX Network, each with dedicated internal funding, executive sponsorship and a focus on supporting diversity, equity, and inclusion within and outside of LegalZoom.

These networks have built internal mentorship and development programs, and contributed to their broader communities outside of LegalZoom through their initiatives.

We have seven employee resource groups today, including Pride Zoomer Alliance Network, Lift Every Voice Black Network, RiseUp Women’s Network, Women in Tech Network, Nos Unimos LatinX Network, and LZ Veterans, each with dedicated internal funding, executive sponsorship, and a focus on supporting diversity, equity, and inclusion within and outside of LegalZoom.

These networks have built internal mentorship and development programs, host meaningful and educational events, and have contributed to their broader communities outside of LegalZoom through their initiatives.

Government Regulation

We operate in a particularly complex legal and regulatory environment.

We are subject to a variety of U.S.

and foreign laws, rules and regulations, including those related to internet activities, UPL, the corporate practice of law, or CPL, privacy, data protection, cybersecurity, data retention, consumer protection, content regulation, the processing of legal documents, legal plans, the provision of online payment services and other matters, which are continuously evolving and developing.

We are subject to a wide variety of state and federal laws, rules and regulations in the U.S., including those related to internet activities, UPL, the corporate practice of law, or CPL, privacy, data protection, cybersecurity, data retention, consumer protection, content regulation, the processing of legal documents, commercial registered agents, the provision of online payment services and other matters, which are continuously evolving and developing.

Our business model includes the provision of services that represent an alternative to traditional legal services, which has subjected us to allegations of UPL in the U.S.

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is evolving slowly with two states so far, Arizona and Utah, approving regulatory reform that permits non-lawyers to co-own law firms and other legal service operations.

We applied for and received a license to operate as an Arizona ABS on September 30, 2021, through our U.S.

subsidiary, LZ Legal Services, LLC.

We received a license to operate one of our U.S.

subsidiaries as an ABS in Arizona in September 2021.

This Arizona ABS employs and contracts with licensed attorneys to provide limited scope legal services to U.S.-based consumers who purchase such services on our websites.

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See Part I, Item 1A, “Risk Factors” of this Annual Report on Form 10-K for additional information.

Available Information

Corporate and Other Information

We are headquartered in Glendale, California.

We were incorporated as a California corporation in July 1999 and converted to a Delaware corporation in February 2007.

Our website is located at https://www.legalzoom.com/.

Our Investor Relations website is https://investors.legalzoom.com/ and we encourage investors to use it as a way of easily finding information about us.

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business