 Brian Lee and Brian Liu |
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More Money Dreams: Retirement Cars |
Starting their own business was something Brian Liu and Brian Lee knew they wanted to do, even when they were in law school.
"We both knew we didn't want to be attorneys for the long haul," said Liu.
Having seen how well businesses like travel and trading were doing online, Liu and Lee came up with the idea of launching a site where customers could draft relatively simple legal documents, such as wills, for far less than they'd pay for a lawyer.
The two incorporated LegalZoom.com in July 1999 and in March 2000 bid farewell to their jobs at big-name law firms in Los Angeles.
"Initially we were thinking we'd get $5 million in seed capital," Lui recalled, but then the bull market began stumbling.
Though they had doubts about going ahead with their plans, going back to their old jobs with their tales between their legs just wasn't an option.
"All of the funding really dried up, so we had to go through our savings accounts and beg our friends to help us get things going," said Liu. With about $50,000 of their own money, they started working out of Lee's condo, subsisting on Top Ramen noodles and McDonald's Happy Meals. They also convinced law school students from area schools to help with the research in exchange for free pizza.
Liu and Lee had one thing going for them. Early on, the two drafted a wish list of attorneys they wanted associated with the site. Robert Shapiro (best known as O.J. Simpson's defense attorney) was one of them. "He loved the idea and had actually been thinking about doing something similar," said Liu.
With Shapiro's name, legal expertise and contacts, Liu and Lee were able to raise $150,000 in capital by August 2000 and move into an 800-square-foot office. In December of that year the crew invited family and friends to log onto their test site, and in March 2001 they opened LegalZoom for business.
"We never did get any big VC money," said Liu, somewhat listlessly. The company raised some more money through a second round of financing, though it was nowhere near $1 million, let alone $5 million.
Even without money to burn on marketing, LegalZoom has already attracted 40,000 and 50,000 actual customers, paying $55 to $115 to have wills drafted, $119 to $199 for prenuptials and $249 to $299 for divorce papers, among other services.
To process all of these documents, Liu and Lee have moved their operations into a 15,000 square-foot office in Los Angeles and hired about 50 employees, who, by the way, they pay in dollars rather than slices.
