By Ellyn Pak
Photographs by Eric Sueyoshi
Brian Lee’s mind is always churning with ideas on how to make things simple.
Some of the end goals seem a bit insipid — how to create a better napkin holder, for example — and most haven’t materialized into anything at all, but he can’t help but constantly think about ways to streamline inefficient processes.
Out of the hundreds of ideas that have crossed Lee’s mind, one hatched into something ingenious.
That was more than seven years ago when Lee and his friend Brian Liu, both recent graduates of UCLA School of Law, co-founded LegalZoom, an online self-help legal document service. The two wanted to create a business that would allow a client to prepare legal documents online without incurring the exorbitant costs an attorney would charge.
“I realized most people have legal issues, but they don’t know where to go,” said Lee, 36, who grew up in Huntington Beach.
“There are so many people out there who don’t have time or money to see an attorney.”
The idea stemmed from family members and friends who called the two budding attorneys for help in creating wills, incorporating businesses and establishing trademarks. Liu and Lee didn’t have the answers to all of the questions, but vowed to somehow figure out a way to help. Plus, they saw a need for something that was not yet on the market.
After carving out the idea a little more, a meeting was set up with a venture capitalist, who could potentially secure $10 million to launch the company. Five weeks of preparing a presentation were for naught when on the day of the meeting, the stock market crashed. It was April 2000, and LegalZoom’s financial backing fell through.
But Lee and Liu stayed the course. They had gone too far with the process, and both had left their former positions as attorneys for high-profile firms, despite family members urging them to maintain a stable career.
Lee took out a second mortgage on his condominium. He and Liu pooled their credit cards, and family and friends contributed money.
In sum, the pair had $200,000 to get the company off of the ground.
What the start-up also needed was a well-known attorney to represent the company. One evening, Lee cold-called Robert Shapiro, the high-profile attorney who was known for being part of the legal team that defended O.J. Simpson in the mid-90’s. He expected to leave a message, but heard a voice on the other line.
It was Shapiro, and an astounded Lee, replied: “What? The Robert Shapiro?”
Shapiro asked Lee if the two knew each other. Lee started his pitch about LegalZoom’s business plan, and Shapiro told him he wasn’t interested. Lee, who could sense that Shapiro was about to hang up, said, “How do you know you’re not interested if you don’t hear me out?”
Shapiro gave the young attorney two minutes to talk about LegalZoom’s business plan. He then gave Lee his secretary’s phone number to schedule a meeting.
The meeting took place a few months later. Shapiro said he would take part in the company if he could play an active role in managing the company. It was a deal.
“He has a great sense of what resonates within the community,” said John Suh, 36, who became LegalZoom’s executive chairman about three years ago. “He’s the face of the company. He’s done hundreds of press interviews and talked about LegalZoom.”
The company — with the addition of another co-founder Edward Hartman — launched in March 2001 in Lee’s tiny condominium on Wilshire Avenue in Los Angeles. Amidst boxes of instant ramen noodles and computers, members of the start-up crammed into the small space and worked toward making the company a success. The company headquarters later moved to a 1,000-square-foot office in Larchmont.
Suh, a family friend of Lee’s, was an advisor to the company from day one, though the legal realm was not his bread-and-butter. Suh was a quintessential businessman and entrepreneur who took part in helping companies create their Internet divisions, including jcrew.com and giftcertificates.com. He was also chief executive officer of StudioDirect, the Internet division of Li and Fung, a global supply chain company.
He took some time off to evaluate the direction of his career and started getting more involved with the strategy of LegalZoom. He officially came on board and became executive chairman.
Today, the company has transformed the $225 billion legal market with a service that provides affordability and lack of legalese. From prenuptial agreements to restraining orders, LegalZoom has provided its do-it-yourself service to more than 500,000 clients.
A common last will through LegalZoom costs $69 to draft. A complete incorporation of a business may cost $500, inclusive of state fees. An attorney usually charges four times that amount.
The process for a first-time user is fairly simple: a client logs in online and fills out the appropriate questionnaire. Once submitted, the customized form is then reviewed and tailored by LegalZoom staffers for grammar, spelling and completeness. Attorneys, attorney fees and the hassle are all eliminated, and LegalZoom ships clients the official documents.
The company, which declined to release its current financial standing, secured financing in March from a national venture capital firm with more than $3 billion under its management.
Lee, who also owns Cantaloop Yogurt in Los Angeles and has produced some independent films, said the co-founders have built a strong foundation for the company’s continued success and intend for LegalZoom to become a household name. Looking back, Lee said he and his partners always believed in the concept of creating an accessible service to everyone.
“We still feel that we’re at the start of where LegalZoom could be,” Lee said. “We’re excited to be here and be part of the legal evolution.”
What started as a germ of an idea turned into an incredible reality.
