Truth Rally

LLC Registered Agent, Part 4

2011-09-30T19:46:00.000-07:00

We recently received an invoice from InCorp Services to renew them as the registered agent for our LLC, and I was pleasantly surprised to find that they had already applied the same price-guarantee discount we received last year to this year's price—without us having to reapply. InCorp's normal annual fee is $99, which is cheap compared to LegalZoom* at $159 per year, but we had to pay only $49. InCorp FTW!

For further information on registered agents, including whether your LLC needs one, and how to get the first year of InCorp's service absolutely free, review the first installment of this series. If you read carefully, you can also find the company that we cited to qualify for that huge price-guarantee discount; this company, unfortunately, only serves California, so if your LLC operates in another state, you'll have to do your own research.

If you decide to use InCorp Services after reading this blog post, please consider using our referral code.

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*We highly recommend LegalZoom for their LLC-formation service, which is of the highest quality; however, the price of their registered-agent service can easily be beat—in our case, by 69%.

Disclaimer Game, Part 2

2011-08-31T21:11:00.001-07:00

As mentioned in part one, our website needs to have a Privacy Policy and Terms of Service before we open it to the public. Like most bootstrapped startups, however, we never seriously considered hiring an attorney to draft these legal disclaimers for us. Fortunately, the Web is chock full of examples, templates, and even generators that will come to your rescue.

After Mike and I did our research, we decided to use Automattic's privacy policy and terms of service, which are each available under a Creative Commons Sharealike license. In short, this means we are free to adapt the documents to our specific needs and to make commercial use of them. Automattic doesn't even require an attribution, though we are more than happy to oblige.

Unlike most of the other examples and templates available on the Web, these particular documents are being actively used, which adds a level of assurance that they will hold legal muster; in fact, Automattic uses them for widely visited websites, such as Wordpress.com. As they write:

"We spent a lot of money and time on [these documents], and other people shouldn’t need to do the same."

Another nice feature is the change log, which allows us to keep our privacy policy and terms of service in sync with theirs as they evolve over time. As Mike can attest, editing these documents will require some research as to which sections are actually applicable to your business, as well as which additions you will be required to make by third parties, such as any companies that run ads on your website.

Status Update

2011-07-31T21:33:00.000-07:00

In July, we completed work on our last custom Drupal module, and began testing our fourth alpha release. We expect to have our final alpha release in August, followed by the launch of our first beta release in late summer. If you are interested in being a beta tester, please sign up here to claim one of the remaining spots.

Status Update

2011-06-30T23:02:00.001-07:00

This past month, we made a number of improvements with respect to the presentation of user data. We also continued development of the final custom module—the major milestone for the fourth alpha release, which should go into its testing phase next week. If you are interested in testing our first beta release this summer, please sign up here to claim one of the remaining spots. For those who have already signed up to be a beta tester, we appreciate your continued patience.

Status Update

2011-05-31T23:09:00.000-07:00

This month, we simplified the public site by moving the sign-up form to the front page, eliminating the promotion feature, and removing the test ads. Also, we began development of the fourth alpha release, which should be completed in June. If you are interested in testing our first beta release this summer, please sign up here to claim one of the remaining spots. For those who have already signed up to be a beta tester, we appreciate your continued patience.

Status Update

2011-04-30T10:51:00.000-07:00

We completed the testing phase of alpha release 3, and fixed all outstanding bugs. We have now shifted our efforts to the next alpha release, which will include the final custom module. This forthcoming release is scheduled to be followed by a final alpha release, after which we will begin beta testing. If you are interested in testing our first beta release, please sign up here to claim one of the remaining spots. For those who have already signed up to be a beta tester, we appreciate your continued patience.

Statement of Information Delays

2011-03-31T23:44:00.000-07:00

Truth Rally recently received its very first collection letter—from the Secretary of State, no less. Blame it on budget cuts; not ours, but theirs. Here's what happened: Last October, we filed our Statement of Information (LLC-12R), along with a check for the $20 filing fee (because they do not permit LLCs to make online payments). Nearly four months later, in early February, we switched banks because Chase discontinued their free business checking accounts. I noticed at the time that we had one outstanding check. You guessed it!

I immediately contacted the Secretary of State's business entities department to inform them that they should not deposit that check, and that I would issue a new one. The woman with whom I spoke told me that they would simply send us a bill for the filing fee when they processed our form. I also sent them an email describing the situation, but never received a response. Several weeks later, we received the aforementioned collection letter, whose subject line reads "Dishonored Check." Somebody didn't pay attention. Luckily, they did not assess any penalties or interest charges, though they did require payment in the form of a certified check, cashier's check, or money order. Our new bank, Comerica, happily agreed to waive their normal cashier's check fee, so we ended up paying nothing extra.

As of today, the Secretary of State is processing Statements of Information received on December 6, 2010. Do the math: They are still nearly four months behind. This is the kind of inefficiency one expects only from a government agency. Don't worry, though, because they are working hard to slash those embarrassing processing times. It is not clear whether their "modernization" plans include full automation of the filing process; this would only require the addition of a Web payment system that any decent programmer could set up for them in a few hours. Given the incompetence of government, however, I'm not holding my breath.

Update: After eight weeks, I received a response to my email:

Due to filing backlogs we're currently experiencing, the processing of your statement/check for payment of filing fees was delayed in getting input into our system. We apologize for any inconvenience this may have caused.

Status Update

2011-02-28T23:38:00.000-08:00

The focus for February was testing—and bug fixes. As a result, little progress was made on our fourth alpha release. Fortunately, I should be able to shift my effort to coding the final major module, the bulk of work scheduled for the next release, by the end of the week. While I do this, Mike will continue putting the current release through its paces.

If you are interested in participating in our forthcoming beta test, please sign up here to claim one of the remaining spots. For those who have already signed up to be a beta tester, we appreciate your continued patience.

Status Update

2011-01-31T21:37:00.000-08:00

We completed our third alpha release, and have begun testing it. Despite what I stated last month, this release does not include all major functionality: There were enough issues raised during the testing of the prior release to warrant a separate release to address them all. As a result, the next alpha release, on which I'm now working, will include the remaining elements.

Given the recent changes to the release roadmap and my availability, our planned January launch has been pushed back to March. If you are interested in participating in our forthcoming beta test, please sign up here to claim one of the remaining spots. For those who have already signed up to be a beta tester, we appreciate your continued patience.

Status Update

2010-12-31T18:46:00.000-08:00

The theme this past month was "the unexpected." In particular, two events considerably impacted our schedule:

I was recruited by another startup. Because of my commitment to Truth Rally, however, I requested a start date next month so that I am able to finish coding the site in the interim. Despite this, I spent a fair amount of time negotiating my employment contract and ramping up on their products.
Our VPS was hacked. Ever the optimist, I view this event as fortunate insofar as the responsible cyber-douchebag* hit us before our launch; thus, we were able to remove the exploited vulnerability with no impact to users. Furthermore, as a result of this attack, we instituted a new recovery policy to prevent any significant downtime should our VPS be successfully targeted after launch.

Despite these digressions from our schedule, testing and debugging have resumed on our second alpha release. Coding on the third alpha release, which will include all remaining major functionality, will begin shortly.

As we approach launch, there are some remaining openings for our forthcoming beta test. If you are interested in participating, please sign up here. For those who have already signed up to be a beta tester, we appreciate your continued patience.

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*I changed the appellation that I use to refer to these wretched individuals when I realized they are more deserving of pity than contempt.

Status Update

2010-11-30T21:59:00.000-08:00

We completed our second alpha release of the Web site, and are now putting it through its paces. This version ended up including a major overhaul, which had originally been scheduled for a later release, and thus took longer than originally planned. As we approach launch, there are some remaining openings for our forthcoming beta test. If you are interested in participating, please sign up here. For those who have already signed up to be a beta tester, we appreciate your continued patience.

LLC Registered Agent, Part 3

2010-10-09T18:58:00.000-07:00

We recently renewed InCorp Services as the registered agent for our LLC, and I am happy to report that they honored their guarantee to "beat any competitor's price on any product or service."

After receiving a renewal invoice for $99, I emailed their customer service with the URL of a competitor who charges only $50 per year for the same service. The next day we received a new invoice for only $49. If you're curious who the competitor is, you'll have to read my first post in this series; however, if your LLC wasn't formed in California, you'll have to do your own research because the competitor must do business in the same jurisdiction.

InCorp Services has friendly, responsive customer service, and their "entity management system" is very cool—and comprehensive. We definitely recommend them. If you decide to use InCorp after reading this blog entry, please consider using our referral code.

Status Update

2010-09-30T23:05:00.000-07:00

We completed the test phase for our first alpha release of the Web site, and are currently making the necessary modifications for our second alpha release. Progress has been steady, and we expect to begin testing on this release in about a week. As we approach launch, there are some remaining openings for our forthcoming beta test. If you are interested in participating in a noble endeavor, please sign up here. For those who have already signed up to be a beta tester, we appreciate your continued patience.

Statement of Information Notice

2010-08-26T18:11:00.000-07:00

We recently received a postcard-sized notice from the California Secretary of State informing us that our Statement of Information (LLC-12R) is due by October 31, 2010. Well, whaddaya know? I managed to determine the correct due date, despite the oddly worded filing instructions:

"Every domestic and registered foreign limited liability company shall file a Statement of Information with the Secretary of State, within 90 days after filing of its original Articles of Organization or Application for Registration, and biennially thereafter during the applicable filing period. The applicable filing period for a limited liability company is the calendar month during which its original Articles of Organization or Application for Registration were filed and the immediately preceding five calendar months."

For those unable to penetrate this language, rest assured you'll receive a notice informing you of the deadline. And if you're wondering what the difference is between Form LLC-12 and Form LLC-12R, the latter has a box that can be checked to indicate no information has changed since the previous filing. I appreciate the added convenience, but it would be nice if we didn't have to pay the Secretary $20 to tell her nothing has changed.

Status Update

2010-07-31T23:24:00.000-07:00

We continued making solid progress this month, and completed the key functionality of the Web site. Woo-hoo! We expect to have our first alpha release in a few weeks. As we approach launch, there are some remaining openings for our forthcoming beta test. If you are interested in participating in a fun and challenging enterprise, please sign up here. For those who have already signed up to be a beta tester, we appreciate your continued patience.

Status Update

2010-06-30T22:56:00.001-07:00

Development of the Web site is back in full swing! We made significant progress this month, and hope to complete the bulk of coding in July. As we approach launch, there are some remaining openings for our forthcoming beta test. If you are interested in participating in this lofty venture, please sign up here. For those who have already signed up to be a beta tester, we appreciate your continued patience.

Final Sprout Update

2010-05-28T15:30:00.000-07:00

The folks at Sprout have finally deleted the Flash widget that was featured on the landing page of our temporary sign-up site. We expected this to happen last summer, so I am pleased we were able to use it as long as we did. I visited their site to see the current pricing, but the link redirects to the landing page. (Their site contains a number of other errant links as well.)

When I tried to log in, I was informed that our account had been closed on March 30, and that they no longer offer the Sprout Builder subscription service. According to this FAQ, access to our widget ended May 14, which, if accurate, means it took us nearly two weeks to notice. Oops. It appears that they only support enterprise clients now, with service starting at $2,999 per year (for previous subscribers). We wish them good luck with their new business model.

We aren't really using Drupal. Really.

2010-04-30T21:54:00.000-07:00

Okay, not really. But according to a MetaFilter user (and, I suspect, some other Drupal purists):

"If not using the views module and CCK, you aren't really using Drupal. Really."

We started out using CCK (Content Construction Kit) and Views, two of the most widely used Drupal modules. I began defining our custom content types using CCK, and Mike began using Views to create the various renderings of those content types. Unfortunately, CCK was too restrictive with regard to the permitted types and relationships of field declarations, and too inefficient with regard to the database types it employed for those fields. Eventually, I abandoned CCK in favor of rolling our own nodes. At the same time, Mike was encountering a number of limitations with Views. Because we were no longer using CCK, it made sense to ditch Views as well. And with those two modules went several other submodules—right into the recycle bin.

Based on our brief experience with CCK and Views, I see how they would be useful for creating conventional objects and displays—especially for non-programmers, who couldn't take the route we did. But for us, they weren't a good fit. As it turns out, for a variety of other reasons, we would've ended up writing our own nodes anyway. No hard feelings, eh?

Status Update

2010-03-31T22:56:00.000-07:00

Progress on the Web site slowed to a crawl earlier this month as I dealt with a nasty recurrence of carpal tunnel syndrome. The good news is that the symptoms have nearly vanished, and I am coding again. Woo-hoo! Meanwhile, Mike continues his work on the site's documentation.

As we approach launch, there are still some openings for our upcoming beta test. If you're interested in participating in this noble endeavor, please sign up here. If you've already signed up, we thank you and request your continued patience.

Domain Registry of America Scam

2010-02-28T22:37:00.000-08:00

Another day, another scam. This one is a misleading domain renewal notice from Domain Registry of America, which, by the way, is actually located in Canada. As with the scams that target LLC owners, this one, too, comes in the form of an expiration notice. In the notice we received, the domain they claim is about to expire was renewed last year, and doesn't expire until 2011. Oops!

This company has been operating for several years, but their notices are not nearly as deceptive as they once were. Why? The Federal Trade Commission went after them for misrepresentation, and a federal district court issued this order in 2003. To comply with the order, the urgency of their notices has been muted, and their offer is more transparent. Specifically, the text of the notice makes it clear that if you pay them to renew, you are actually transferring your domain name from your current registrar to theirs. They are, of course, hoping that you don't read it too carefully, because it is a terrible offer (more on that below). Furthermore, the actual registration agreement, which is on the reverse of the notice, is printed in a font so small, most people would need a magnifying glass to read it. Again, they are complying with the law, but hoping you don't actually read it.

Other than the bogus expiration date and the fact that some recipients will mistake it for a renewal notice from their current registrar, what really makes this offer a scam is the price: Their annual renewal rate of $30 is several times the going market rate. Unfortunately, the fact that they are still sending out these notices means that they are still getting people to pay that exorbitant price. Compliance with the law has simply lowered their profit margin, but hasn't put them out of business. Wake up, people!

Status Update

2010-01-31T22:35:00.000-08:00

With the recent migration of our sign-up Web site, we have completed our transition from Go Daddy shared hosting to Linode VPS hosting. Behind the scenes, development on the actual Web site continues. As we approach launch, we still have some openings for our upcoming beta test. If you're interested in participating in this noble venture, sign up here. For those who have already signed up to be a beta tester, we apologize for the delay.

Go Daddy Domain Renewal

2009-12-31T10:42:00.000-08:00

I just renewed our domains with Go Daddy, and things didn't go as smoothly as they have in the past. I tried to use some of the coupon codes they sent me (e.g., gdr1251x, which takes 25% off a $60 purchase), but found that these coupons don't apply to bulk renewals or otherwise discounted items. This was confirmed by a customer-service representative with whom I spoke. Unfortunately, he failed to offer me any discount beyond the bulk rates that were already applied to my shopping cart. He did, however, offer to complete my transaction. I politely declined, as I was not ready to admit defeat.

I tested all of the codes available via the popular coupon Web sites, but none* of them worked for my purchase. I then tried the other coupon codes I had been sent this month, but again no luck. I even tried splitting the purchase into two transactions to avoid the bulk discounts in favor of a possibly larger coupon discount. This didn't work either because some of the domains were still being discounted. Finally, I noticed that some of the expiration-notice emails contained coupon codes for 10% off, with no minimum purchase requirement. The first two didn't work, but the third one did. The winning code was gd50bbpd5. No expiration date was given, but most of the codes that Go Daddy sends by email expire in less than 30 days. If you need it, hurry before it's gone.

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*There were coupon codes available that gave a tiny discount for .com renewals, but I was looking for a dollar or percentage discount off the entire purchase.

LLC Registered Agent, Part 2

2009-11-28T12:22:00.000-08:00

We recently switched to a new registered agent, which required us to notify the Secretary of State by filing an updated Statement of Information (Form LLC-12). Unfortunately, we didn't take mail processing times into account, which left us in agent limbo for a few weeks. Apparently, recent budget cuts in California have sharply increased how long it takes the Secretary of State to process requests.

I contacted our former agent, LegalZoom, and they assured me that they would forward any court documents served to us during the period between the time that we signed up with InCorp Services and the time that the Secretary of State recorded the change of agent. As far as I know, they were not required to do this, so I would not recommend relying on the good will of your current agent if you plan on switching. Instead, check the mail processing times in your state, and make the switch early enough for the change to be recorded before the contract with your current agent expires.

Annual Filing Division Scam

2009-10-21T15:01:00.000-07:00

First there was Annual Review Board. Then there was Business Filings Division. Now there is Annual Filing Division. How many more will there be? None, if LLC owners simply ignore these bogus payment notifications. Save your money, and file your Statement of Information (Form LLC-12) directly with the Secretary of State when it is actually due. The Attorney General can't help you if you've already paid. Please review all solicitations carefully so that you don't end up being a victim.

LLC Registered Agent

2009-10-18T14:18:00.000-07:00

California's Secretary of State requires that each LLC designate a registered agent (or agent for service of process), who will accept summonses or other court papers in the event of a legal action. Failure to comply with this requirement could result in a costly default judgment. Companies operating in California are not allowed to act as their own agents, so this is yet another cost of doing business in the Golden State.

We formed our LLC using LegalZoom, whose LLC packages include one year of registered-agent service. We considered renewing with them, but they charge $159 per year (or $144 per year for a two-year renewal), which is more expensive than many other agents. For example, we received a solicitation from Patel & Alumit, who charge only $50 per year.

The Secretary of State provides a list of private service companies, which is too lengthy to serve as a useful starting point, but can be used to verify that a company can legally serve in this capacity. I found this blog post and this site to be good places to start a search. We selected InCorp Services because of their price guarantee, track record, and Web offerings (i.e., entity management system). They charge $99 per year, but they will match the price of any other registered agent in the same jurisdiction. I called their 800 number and confirmed that this is, in fact, the case. Bonus: If you register through this site, the first year is free!

After hiring a new registered agent, you will need to notify the Secretary of State by filing an updated Statement of Information (Form LLC-12). If you file the updated form outside the normal filing period*, the $20 filing fee is waived, which was the case for us.

Update: Read this to avoid a potential hazard.

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*The normal filing period for an LLC occurs every other year during the calendar month in which its original Articles of Organization were filed and the immediately preceding five calendar months. For example, we filed our Articles in October 2008, so our next filing period will be May through October 2010, during which time we must file a new Statement of Information to comply with the biennial requirement.