EB-5 Visa: What it is and What it Means

Along the bumpy road toraising venture capital,

some avenues of potentialsources for funding can go

unexplored. Yet, all toooften, these avenues are

the most relevant,applicable, and mostefficient mediums forraising the necessary

monetary resources. Onesuch avenue is the EB-5

Immigrant InvestorProgram.

Administered by the United StateCitizenship and Immigration Service,this government sponsored programwas founded in 1990 by Congress in

order to bolster the Americaneconomy. The EB-5 Visa (aka the

“Immigrant Investor Program)attempts to do this primarily through

job creation stimulated by foreigncapital investment. It was initiallyproposed as merely a pilot programbut, due to its resounding success, it

has been reauthorized every yearsince the program’s initial

implementation.

The Immigrant Investor Program requires an investment in either a newenterprise that will create at least ten full time workers (within two years) or

an investment in a troubled enterprise that will save jobs. These jobs mayeither be direct jobs (people employed in the commercial enterprise that

receives the invested funds) or indirect jobs (those employed in othercompanies within a certain geographic region that arise due to the existence of

the new enterprise). The investment amount must be at least one milliondollars unless the investment is made in an area of high unemployment or in a

rural area, in this case the required amount is lowered to $500,000.

investors and venture funds.By now, the question you are probably asking

yourself is “Why should I find a program with somany rules interesting?” or “How can this help

me?” You may even wonder why you haven’t heardabout this program if it has been around for more

than 20 years! Well, yes, it has indeed been inexistence for ages but most people traditionallyfund their new businesses by either going to the

bank or from friends and family or from thirdparties such as angel investors and venture funds.

All those channels dried upin 2008. The financial crisis

affected every source ofcapital in the United States

and unless an idea wasfoolproof and expected to be

the next Facebook thensecuring funding was very

unlikely. Even if yourfriends and family wantedto help you they needed to

preserve capital forthemselves in the event of a

job loss – a very likelypossibility between 2007 and2012. With domestic capital

markets frozen, a fewentrepreneurs suddenly

remembered the EB5program and decided to

explore it.

I was among one of the few trying to find capital amidst a recession. What’s worseis that I was trying to finance a restaurant. Double whammy. However, this is

where the program is helpful. Restaurants, unlike say bio-tech ventures, employa large number of people and this is what foreign investors, found through this

program, need. Yes, I was able to find the investors….but not before spending theequivalent of three MBA degrees and almost losing my sanity in the process. I

realized that while this was an incredible opportunity it was a path best traveledby someone with experience. I have since established a business to help

entrepreneurs navigate the ocean to securing EB-5 funding as well as other nichecapital channels.

Why should you want to explore EB5 funding? It is one of thelowest cost sources of mezzanine and equity funding currentlyavailable to entrepreneurs. Is it reliable? Well the developers

behind the Barclays Center and Hudson Yards certainly think so.More than $600 million in EB-5 funding was raised for these well-

known projects.

If you would like to explore this funding option for yourproject please reach out via The Opes Group website or

through this site’s contact page.