May 12, 2012
LegalZoom Files for IPO
LegalZoom plans to go public. According to the company's Form S-1 registration statement, which was just filed with the SEC, the company had $156M in revenues in 2011, with profits of $12 million. Here is the first line of the prospectus:
We believe that everyone deserves access to quality legal services so they can benefit from the full protection of the law. Our mission is to be the trusted destination where small businesses and consumers address their important legal needs and to be our customers' legal partner for life.
Well, LegalZoom seems to be making progress.
We have served approximately two million customers over the last 10 years. In 2011, nine out of ten of our surveyed customers said they would recommend LegalZoom to their friends and family, our customers placed approximately 490,000 orders and more than 20 percent of new California limited liability companies were formed using our online legal platform. We believe the volume of transactions processed through our online legal platform creates a scale advantage that deepens our knowledge and enables us to improve the quality and depth of the services we provide to our customers.
I recently rented a car on a business trip. The radio was tuned to the Jim Rome Show, a national sports radio talk show that is carried by more then 200 stations nationwide. During my two hour drive, I heard at least four LegalZoom radio commercials.
What is LegalZoom's long term play? Based on the S-1, it is to use its trusted brand to build a network of "legal subscribers" who obtain legal advice from licensed attorneys. As LegalZoom says,
We are not a law firm, and we do not provide legal advice. We provide self-help legal documents at our customers' specific direction and teneral information on legal issues generally encountered. Independent, licensed attorneys participate in our attorney network to provide services to our customers through our legal plans.
LegalZoom is seeking $120M for general corporate purposes. Sheppard Mullin and Latham & Watkins are listed on the S-1 registration statement. Think LegalZoom is no big deal? If so, I would encourage you to read my previous post.
[posted by Bill Henderson]
To avoid the unauthorized practice of law conundrum it finds itself in as it defends against numerous lawsuits, Legalzoom has taken to putting up lawyers as their line of defense. But the LZ attorney services plan may not be what it appears.
There seems to be a lot of misinformation about how the LZ attorney plan actually works. I was the LZ plan attorney provider for Illinois, Indiana and New York. I filed a federal complaint against LZ for the way they ran the attorney services plan. Draw your own conclusions. Here is the link:
What's sad is that in the end the public by virtue of being LZ shareholders will be defending lawsuits against the deception of the company's own customers who are the public- a situation akin to the bailout of Wall Street by the public (taxpayers) for taking advantage of the ... public.
Alex Rozman esq
Rozman Legal Group PC
Posted by: Alex Rozman | Jun 7, 2012 10:35:19 AM