Can Franchising Work With An E-2 Employee Visa?

Two of the most popular programs for prospective immigrants seeking a US green card or visa are the USCIS EB-5 and E-2 programs.  Around 99% of all EB-5 immigrant investors choose to place their funds with a large Regional Center which create or manage projects such as large infrastructure, hospitality, real estate, or other large projects.  But, we are starting to see a trend of immigrant investors investing in both EB-5 and E-2 Employee Visa programs via franchises.

So, high level yes.  Franchising can absolutely work with E-2 Employees Visas.

 

What Are The Main Requirements For An E-2 Employee Visa Being Used For A Franchise?

There are a few key things to keep in mind when considering an E-2 employee visa via franchising, including the following:

• Investment Amount – The lowest amount that we’ve seen approvals for an E-2 visa via franchising is about $50,000.  However, a more likely scenario is an investment of $100,000 – $400,000.
• Ownership Amount – This one has a little bit of give and take to it.  For an EB-5 investment, you’re probably going to end up owning about 25% of a franchise yet you’re usually fronting an amount of $800,000 – $1,000,000.  For an E-2 visa situation to work, you legally have to own 50% of the franchise yet you only invest between $100,000 – $400,000.  So, in a weird way, if you can find the right partner, you actually end up owning twice as much of the franchised business for a much smaller investment.  Having said that, some EB-5 investors want to get their investment back within 2-7 years.  But, with an E-2 visa, your visa is tied to your franchised location sticking around.  So, you want that franchise to last as long as possible and tend to be more vested in its success and more actively involved in decision making than an EB-5 investor.
• No Employee Requirement – One of the challenges for EB-5 investors is that you have to have 10+ employees maintained over a 2 year period.  So, when an EB-5 investor chooses a franchise to invest in, it has to be one that maintains a high payroll.  However, there is no hiring requirement for E-2 visas.  So, it opens up the door for smaller opportunities like using a Cloud Kitchen / Ghost Kitchen for a small delivery-only restaurant or even doing an owner-operator home service business once you live in the US.
• Finding A Partner – The key to successfully acquiring an E-2 visa via franchising is to choose the right partner.  You want to work with a group that really understands franchising and has been in the franchising space for at least 10 years.  If you’re from Southeast Asia, choosing a partner that understands Asian culture or perhaps even your language can become important.  Also trustworthiness becomes a really big deal.  You really want a partner that understands how to maintain a profitable business and you can trust for years if not decades to come.

 

Interested In Working With Us As Your E-2 Partner?

While we are newer to the EB-5 and E2 franchising space, we are veterans within franchising in general.  Our ad agency Lead PPC has worked with hundreds of franchise brands, has helped sell close to 2,000 franchises, and we also own quite a few franchises ourselves.  We like EB-5 and E2 migrant investors because it allows us to scale the number of franchises that we own and operate more quickly, and it provides a long-term win win for the migrant investor with much lower risk and potentially a much higher ROI than what you can get from large projects via Regional Centers.

If you’re interested in learning more, please fill out the form on our website EB5Franchising.com.