There are different ways to fund your business in the United States. It depends on how much potential the business has for growth and what the balance sheet looks like as to whether you’ll have an easy time or a hard one finding potential investors.
The younger the business, the more difficult it is to convince angel investors, venture capitalists or a local bank to put money into the company.
EB-5 Funding 101
One interesting option that many US entrepreneurs don’t know about is the EB5 Immigrant Investor Program. It’s an act that passed in the 90s which granted a foreign investor a faster way to gain US citizenship providing investment capital to an American company.
One of the main provisions is that the investor must finance a minimum of $500,000 which also creates at least 10 new jobs within the company. As such, this is partly about helping smaller businesses with new sources of funding but it’s also about bolstering local employment too.
It is possible to entertain multiple EB5 qualifying foreign investors, however, each must contribute at least half a million and add at least 10 extra jobs for each investor. Therefore, a $1m total investment from two investors must create 20+ new jobs.
Is EB-5 Funding a Viable Source of New Investment?
For companies that need funding yesterday, then obviously not. The process of finding, attracting, completing the paperwork and getting approval doesn’t happen overnight.
However, if your company is looking for long-term investors, substantial funding and wishes to grow into a robust business while being a key employer of staff in yourcommunity, then there’s a lot to get excited about with EB5.
What’s the Screening Process for EB5?
The citizenship screening process for people applying is a hurdle to get over. It’s possible for applicants to be pre-approved by their achieving exemplar status. This allows the EB5 application to subsequently move along more smoothly because the citizen screening requirement has already been completed.
When it comes to securingEB5 Funding, it pays to deal with an experienced attorney who knows how the EB5 process operates and what to expect at each point in the process. Hirson Immigration have considerable experience with these types of applications which is worth strong consideration.
How to Make Your Company More Attractive to EB-5 Investors
What you must do is make your business more marketable to potential investors. Any investor needs to understand the plan for the company going forward and specifically how their capital will be deployed. It is a good idea to anticipate investors’ questions and have anFAQ section to cover these in detail.
Being clear and transparent about any upcoming challenges like extra costs or zoning approvals pending is helpful. This doesn’t mean the investor will shy away from your business – on the contrary; often they will be pleasantly pleased at your level of candor. After all, they want their investment to pay off for them.
Achieving new funding for your business through the EB5 system is an excellent option when finding new investors becomes more difficult. Marketing your company well is the key to success in both finding and attracting them.