Starting a new business can be both exhilarating and overwhelming, especially when it comes to the legal side of things. From filing incorporation paperwork to creating equity plans for employees, it can feel like there’s an endless list of legal tasks that need to be done. For many entrepreneurs, handling this paperwork is a major hurdle, especially if they don’t have a legal background. This is where Clerky steps in.
Clerky is an online service designed to simplify the complex legal requirements for startups. Whether you’re incorporating a new company, raising venture capital, or hiring your first employees, Clerky aims to make the process smoother, faster, and more affordable. In this comprehensive review, we’ll cover all the aspects of Clerky — its features, pricing, pros and cons, customer feedback, and more — to help you determine if it’s the right solution for your startup.
What Is Clerky?
Clerky is an online platform that helps entrepreneurs handle various legal tasks typically associated with starting a business. It’s a legal technology service specifically designed to cater to the needs of startups, especially those aiming to raise venture capital. It provides a suite of tools for forming your company, drafting essential contracts and documents, managing your company’s legal maintenance, and complying with other legal requirements.
Founded by a group of former Silicon Valley lawyers, Clerky aims to make the legal process simpler, faster, and more transparent for startup founders. Unlike some other online legal services that offer a broad range of services, Clerky focuses specifically on startup legal needs. If you are building a venture-backed company, Clerky is built with you in mind.
Core Features of Clerky
Here’s a breakdown of the main features Clerky provides:
- Company Incorporation: Clerky allows you to easily incorporate a company, specifically a Delaware C-Corp, which is the preferred structure for startups that plan to raise venture capital. Incorporation involves filing with the Delaware Secretary of State and setting up key documents like articles of incorporation.
- Raising Capital: Clerky simplifies the process of preparing the necessary documents for fundraising, including convertible notes, SAFE (Simple Agreement for Future Equity) notes, and board consents. These are key documents for startups looking to raise money from investors.
- Hiring Employees and Contractors: As your company grows, you’ll need legal documents for hiring employees, contractors, and other stakeholders. Clerky provides templates for creating offer letters, consulting agreements, and employment agreements.
- Managing Legal Maintenance: Over time, companies go through many changes, and keeping track of legal filings is essential. Clerky helps with important changes to your company, such as amending the articles of incorporation, increasing authorized shares, or issuing stock to employees.
- Foreign Qualification: If you decide to operate your business in other U.S. states beyond Delaware, Clerky can assist you with foreign qualification, a process that allows your Delaware company to do business legally in other states.
- Post-Incorporation Services: Once you’ve incorporated, Clerky helps you with ongoing legal maintenance, including stock issuance, meeting minutes, and equity agreements. These are crucial for keeping your company legally compliant and investor-ready.
Pricing Structure: Pay-As-You-Go vs. Lifetime Plan
One of the key aspects of any legal service is how much it will cost. Clerky offers two main pricing models for their services: Pay-As-You-Go and a Lifetime Plan.
1. Pay-As-You-Go
Clerky offers a pay-per-use pricing model, which means you only pay for the services you need. This model is flexible if you’re unsure of how much legal work you’ll need upfront. Here’s what it typically costs:
- Company Incorporation: $427 (this includes Delaware state filing fees).
- Registered Agent: $125 per year. This is an additional cost you’ll incur if you need a registered agent in Delaware, which is required for all Delaware corporations.
- Post-Incorporation Services: Prices vary based on the type of service you need. For example, issuing stock to employees might cost more than simple amendments to your incorporation documents.
- Foreign Qualification: Costs for foreign qualification depend on the state you are registering in.
The pay-per-use pricing model is suitable if you only need a few services or want to handle your legal needs as they arise. However, if you plan to use Clerky for several tasks, it may be more economical to opt for the Lifetime Plan.
2. Lifetime Plan
The Lifetime Plan is a one-time payment of $819. This covers all the standard services you’ll need for incorporation and post-incorporation legal work. It’s designed for entrepreneurs who want a one-stop solution to handle everything related to the formation of their company, with the added benefit of not having to worry about paying for each individual service.
While the Lifetime Plan is a higher upfront cost, it can be a good value if you expect to need several services or plan to use Clerky for the long term. Additionally, it includes some post-incorporation services, which are essential as you grow your company.
Pros of Using Clerky
1. Streamlined Process for Startups
Clerky’s biggest advantage is its focus on the unique legal needs of startups. The platform is easy to use, and all the documents are tailored to meet the needs of early-stage companies. If you’re a founder looking to get your company up and running quickly and efficiently, Clerky’s user interface makes the whole process much easier compared to traditional legal services.
2. Quality and Accuracy of Documents
The legal documents on Clerky are drafted by experienced startup attorneys, which means that you’re getting top-tier, reliable legal work. This is a huge benefit because getting legal documents wrong can have serious repercussions down the road. For example, issuing stock or preparing fundraising documents incorrectly can cause delays or even derail an investment round.
3. No Hidden Fees
Clerky is transparent with its pricing, which is always a good sign in the legal world. With other services like LegalZoom, you often find yourself being upsold on add-ons or additional services. Clerky, on the other hand, sticks to its clearly stated pricing structure with minimal upselling.
4. Fast Incorporation
Time is of the essence for most startups. Clerky’s incorporation process is quick, and Delaware filings are typically processed in 1-3 business days. This is significantly faster than many other legal services, which can take weeks to process incorporation paperwork.
5. Collaborative Tools
Clerky is designed to allow you to collaborate with your legal team or advisors efficiently. This makes it easy for your investors, lawyers, or co-founders to review and sign documents, helping your business move faster and more effectively.
Cons of Using Clerky
1. Limited Company Structure Options
Clerky only supports Delaware C-Corp incorporation. While this is the ideal structure for most venture-backed startups, it’s not suitable for everyone. If you’re looking to form an LLC, S-Corp, or another type of entity, Clerky won’t be able to help you.
2. Lack of Ongoing Compliance Support
While Clerky provides the documents you need to stay compliant in the early stages of your company, it doesn’t offer ongoing compliance support. This means that you’ll have to manage your compliance separately or through another service. Some entrepreneurs prefer a more comprehensive package that includes compliance monitoring, which is where services like LegalZoom come in.
3. Additional Costs for Certain Services
While the pricing structure is generally transparent, there are several services that are not included in the base price and can add up over time. For example, services like foreign qualification or the preparation of certain legal documents, such as equity plans, come with additional fees.
4. Mixed Customer Service Reviews
Some customers have reported mixed experiences with Clerky’s customer service. While most users appreciate the platform’s ease of use, others have had difficulties reaching support or receiving assistance when things don’t go according to plan. The customer service can be a bit slow, especially if you have a complicated issue.
User Reviews and Experiences
Positive Feedback
- Ease of Use: Many users commend Clerky for its simple interface and clear instructions. The platform is designed in a way that even first-time founders can navigate it without feeling overwhelmed.
- Professionalism: Several reviewers have praised the quality and professionalism of the legal documents provided by Clerky. Many founders report feeling confident that their legal documents are in good hands.
- Transparency: Clerky’s clear and transparent pricing structure has received positive feedback. Unlike many legal services that tack on hidden fees, Clerky gives you a clear idea of what you’re paying for from the start.
Negative Feedback
- Upselling and Billing: A few users have mentioned that they were pressured into buying additional services or found unexpected charges during the process. This can be frustrating, especially when the platform promises simplicity and transparency.
Clerky vs. Other Legal Services
Clerky vs. LegalZoom
LegalZoom is one of the biggest competitors to Clerky, and while it offers a broad range of legal services for businesses of all sizes, it’s not as focused on the needs of startups as Clerky. LegalZoom provides LLC and S-Corp formations, but it doesn’t have the same specialized tools for fundraising, issuing equity, or managing investor-related documents.
Clerky excels when it comes to helping startups raise venture capital and handle all the specific documents that investors require. However, LegalZoom may be a better choice if you’re looking for a more comprehensive legal service that includes things like trademarks, wills, or other types of legal help outside of startup formation.
Clerky vs. Stripe Atlas
Stripe Atlas is another alternative for startup incorporation, particularly for international founders who want to set up a U.S. company. Stripe Atlas is focused on helping tech startups integrate into the Stripe ecosystem, offering a U.S. bank account and tax identification number. However, it’s more limited in its legal features compared to Clerky, which provides more specific legal documents tailored to startups raising venture capital.
While Stripe Atlas is a great tool for integrating payments and forming a U.S. entity, Clerky is more robust when it comes to managing the legal documents you’ll need to run and grow your business.
Final Thoughts: Is Clerky Right for You?
Clerky is an excellent choice for founders looking for a simple, reliable, and cost-effective solution for forming a Delaware C-Corp and handling the legal aspects of fundraising, hiring, and equity issuance. The platform’s streamlined approach and high-quality legal documents make it ideal for startups that want to focus on growth without getting bogged down in legal complexities.
However, if your business needs a broader range of legal services, requires ongoing compliance support, or needs a different type of entity formation, you may want to consider other options like LegalZoom or Stripe Atlas.
Ultimately, Clerky offers a fantastic, no-frills solution for the right kind of startup—those that want to get their legal documents in order and focus on building their business without unnecessary complexity. If that sounds like you, Clerky could be your perfect legal partner on the road to success.
FAQ’s
What type of companies can I incorporate with Clerky?
Clerky only supports Delaware C-Corp incorporation.
Does Clerky offer LLC formation?
No, Clerky specializes in Delaware C-Corp formation and does not support LLC formation.
How long does it take to incorporate a company with Clerky?
Delaware filings are typically processed in 1-3 business days.
Is Clerky a good choice for raising venture capital?
Yes, Clerky is specifically designed to help startups raise capital, with tools like SAFE notes and convertible notes.
Can I use Clerky for ongoing legal compliance?
No, Clerky does not offer ongoing compliance monitoring or legal representation.
What’s the difference between Clerky and LegalZoom?
Clerky is tailored specifically for startups raising venture capital, while LegalZoom offers broader services, including LLC formation and ongoing compliance support.