Written by: McEntee Law Group, Fiona McEntee, Sequoia Gallaway

 

Navigating the New Thresholds & Updated Evidence Guidelines for Immigrant Startup Founders

 

***We’re updating this piece to add in the USCIS policy alert updates on December 12, 2024: Supporting Evidence for International Entrepreneur Parole***

 

Our regular followers know just how passionate we are—and how hard we’ve worked—for the International Entrepreneur Parole (IEP) program.

IEP is a fantastic initiative that allows certain foreign entrepreneurs to live and work in the U.S. temporarily. We’ve been advocating for this program for years because it’s a great option for startup founders. While it’s not technically a visa, it provides a pathway for founders to enter the U.S., build their businesses, create jobs, and boost the economy.

Innovation and entrepreneurship are the backbone of the American economy. They fuel job creation, spark new industries, and keep the U.S. at the cutting edge of technological advancement. Immigrant entrepreneurs are a vital part of this, bringing fresh ideas and a relentless drive to succeed.

To date, only 94 IEP applications have been filed, with just 26 approvals. We’re proud to share that one of those approvals came from our firm, and we believe it set a record—approved in just a few months, while other cases have taken years!

Our IEP client is the founder of an AI startup, exemplifying the entrepreneurial spirit the U.S. aims to attract. This success story is a testament to our dedication to helping founders achieve their American dreams and to their trust in us to navigate these uncharted waters.

If you’re considering visas to the U.S., IEP should become part of the analysis to explore if it’s right for you.

Recently, the USCIS updated the threshold amounts for the IEP program and updated the supporting evidence required, and we want to keep you in the loop. Starting October 1, 2024, there are new changes to the investment and revenue requirements.

 

Who can apply for International Entrepreneur Parole?

Immigrant entrepreneurs may be eligible for the IEP if they meet these eligibility requirements:

• Substantial Ownership Interest: Applicants must hold at least a 10% ownership interest in the startup at the time of the initial application and 5% when renewing. Evidence might include organizational documents, equity purchase agreements, contracts, bank records, amongst other things.
• Central and Active Role: Entrepreneurs must demonstrate they’re actively involved in the startup’s operations. This can do this by providing a description of their role, employment agreements, or letters from co-founders or team members.
• Well-Positioned to Drive Growth: Applicants must show they are can substantially assist with the startup’s growth and success. Evidence can include resumes, letters from investors or business associations, press, participation in accelerators, patents.

 

What are the new threshold amounts for investment/grants?  

• The qualified investment amount has increased from $264,147 to $311,071.
• The government awards or grants amount has increased from $105,659 to $124,429.

 

Evidence of investment can include:

• Equity purchase agreements.
• Convertible debt agreements.
• Equity certificates.
• Equity ledgers.
• Capitalization tables.
• Audited financial statements.
• Bank records.
• Wire transfers.
• Other evidence that the investment is a purchase from the start-up entity of its equity, convertible debt, or other security convertible into its equity commonly used in financing transactions within such entity’s industry.

Evidence of government awards or grants can include:

• Copies of grant or award letters or notices.
• Other documentation from the government entity confirming the issuance of the award or grant, including the amount of the award or grant as well as the recipient.
• Information from news articles or websites demonstrating that the government entity regularly makes such awards or grants to start-up entities.
• Similar evidence showing that a federal, state, or local government entity made a qualified government award or grant to the start-up entity, and that the government entity regularly makes such awards or grants to start-up entities.

 

Remember that you can still apply if you have received less than the above, but we would want to bolster the case with additional evidence of the startup’s potential for growth and job creation.

That evidence can include:

• Number of users or customers.
• Revenue generated by the start-up entity.
• Additional investments or fundraising, including through crowdfunding platforms.
• Social impact of the start-up entity.
• National scope of the start-up entity.
• Positive effects on the start-up entity’s locality or region.
• Success using alternative funding platforms, including crowdfunding platforms.
• The applicant’s academic degrees, with an explanation of how the field relates to the start-up entity’s focus.
• The applicant’s prior success in operating start-up entities as shown by patented innovations, annual revenue, job creation, or other factors.
• Selection of the start-up entity to participate in one or more established reputable start-up accelerators or incubators.
• Any other reliable and compelling evidence that the start-up entity has substantial potential for rapid growth and job creation.

 

What are the new criteria for qualified investors?

A U.S. investor is considered “qualified” if they have made investments of at least $746,571 (previously $633,952) in other startups. Additionally, at least 2 of those startups must have created at least 5 qualified jobs OR generated $622,142 (previously $528,293) in revenue with average annual revenue growth of at least 20%.

 

Why did the amounts change?

By regulation, the investment and revenue amounts must be automatically adjusted every 3 years by the Consumer Price Index for All Urban Consumers (CPI-U).

 

What is significant public benefit, and why do I need to show it?

In addition to meeting the investment, grant, or award criteria, the applicant should submit additional supporting evidence describing their start-up and demonstrating its substantial potential for rapid growth and job creation.

Such evidence may include:

• Evidence of investments from any investors (including those that do not meet the definition of qualified investor), or government awards or grants (including those that do not meet the definition of qualified government awards or grants). Such evidence could include bank records, wire transfers, equity purchase agreements, equity certificates, equity ledgers, or capitalization tables.
• Evidence of revenue generation.
• Letters from relevant government agencies, qualified investors, or established business associations with knowledge of the start-up entity’s research, products, or services. Letters from the same organizations or individuals confirming that the applicant’s knowledge, skills, or experience would advance the start-up entity’s business.
• Newspaper articles or other similar evidence that the applicant or their start-up entity have received significant attention or recognition.
• Evidence that the applicant or their start-up entity have been recently invited to participate in, are currently participating in, or have graduated from one or more established and reputable start-up accelerators.
• Patent awards or other documents indicating that the applicant or their start-up entity are focused on developing new technologies or cutting-edge research.
• Evidence that the start-up entity is furthering the development of a critical and emerging technology or other science, technology, engineering, and math (STEM) area important to U.S. competitiveness.
• Evidence that the applicant has played an active and central role in the success of prior start-ups, such as letters from relevant government agencies, qualified investors, or established business associations with knowledge of the applicant’s prior start-up activities.
• Academic degrees or other documentation indicating that the applicant has the knowledge, skills, or experience that would significantly advance their start-up entity’s business.
• Tax or payroll records, I-9 records, or other documents indicating that the applicant’s start-up entity has created qualified jobs before the applicant filed for parole.
• Any other reliable evidence indicating the applicant’s start-up entity’s potential for growth and the applicant’s ability to advance their start-up entity’s business in the United States.
• Any other evidence that a grant of parole would provide a significant public benefit to the United States based on the applicant’s role as the entrepreneur of a start-up entity, if the other listed evidence does not apply to the applicant’s entrepreneurial activities.

 

Who should consider International Entrepreneur Parole?

If you’re a foreign startup founder raising funds or receiving government grants in the U.S., IEP could be a valuable option. It may not suit everyone, but it’s worth exploring to see if it aligns with your needs.

 

Where can I learn more?

You can read about our IEP approval here, and you can watch our Managing Partner, Fiona McEntee, discuss the program at length on the Journey Podcast here.

If you’d like to see if this option could work for you, you can book a consultation with an attorney from our team here.

 

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