7 Tips For Businesses Looking for EB-5 Funding

Since 1990, foreign investors from China, Canada and the Middle East have invested more than $6.8 billion in American businesses, been awarded 29,000 U.S. Visas, and created thousands of American jobs through the EB-5 Immigrant Investor Program. The EB-5 program allows foreign investors to obtain a green card and a path to U.S. citizenship when they invest in American job-creating projects.

To qualify for EB-5 funding, businesses need to demonstrate that their enterprise or project can create 10 new full-time jobs for U.S. workers per each invested $1 million (or $500,000 if business is located in Targeted Employment Area). In the past few years, the program has expanded in popularity amongst American business owners because it allows them to gain supplemental financing, and EB-5 capital can be obtained more quickly and easily than traditional bank or small business loans.

Related: China's Effect on the U.S. VC Game

In 2014, for the first time in Immigrant Investor Program history, more than 10,000 EB-5 visas were issued, a nearly 25 percent increase from 2013. During the last few years of the program’s history, there has been $5 billion in direct investment and 85,500 directly-created full-time jobs. This program has gained so much popularity that it has been extended by Congress five times and is even attracting interest from new regions like Vietnam, Brazil and Russia.

Here are 7 tips to help business owners secure EB-5 funding:

1. Marketability is key.

With hundreds of EB-5 projects available, competition is fierce, and the only way to stand out to potential investors is to create a marketing campaign that establishes trust, showcases security measures, addresses investor concerns and appeals to regional interests. Do your research and learn about your investors, and you'll create original and appealing marketing material to help attract and win them over.

2. Be transparent.

Trust is crucial in the EB-5 game -- and transparency is everything. Be open about the potential risks your project presents. Are your building and zoning permits in place? Is your land for development secured, or will this depend on the EB-5 investors? Where are your feasibility reports and do these outline reasonable numbers for your project? Tying up loose ends and ensuring you have done your homework will give you the best chances of securing EB-5 investors.

3. Prepare for tough questions.

Aside from the firms who will be vetting your project, you'll receive the toughest questions from those who matter most -- the investors. They will want to know where their money is going, how well their money is secured, whether there are any major risks and what can happen in a worst case scenario. Being prepared to answer these tough questions will not only give you credibility, but it will also create the most secure project possible, both for yourself and EB-5 investors.

Related: More Than Money: 4 Tips to Find the Right Investor for Your Startup

4. Consider a regional center.

A regional center is an organization designated by U.S. Citizenship and Immigration Services (USCIS) that sponsors capital investment projects for investment by EB-5 investors. Businesses have succeeded in EB-5 both through their own projects and those hosted by regional centers. Licensing a regional center, or having your project hosted by a regional center comes with benefits. They help investors and project developers because they make it easier to meet the job creation qualifications of the EB-5 program.

Also, if you choose wisely, the reputation of the regional center will actually help you sell your project to potential investors and add to your credibility. This is especially helpful if you are working on your first EB-5 project. In addition, you may count indirect jobs in your job count if you are hosted by a regional center. More jobs mean more investors, and also a better chance of meeting the job creation demands that the program requires.

5. Create a job buffer.

Job creation is one of the main tenants of the EB-5 program, where 10 jobs from the project must be allocated to each application. Here is where the investor is depending on you for the success of their application. If you are looking for 10 investors, don’t settle for ensuring 100 jobs. Create 115 jobs. It’s much better to create at least a 15 percent buffer, so if less jobs are created for any reason, your investors do not suffer by losing out on the jobs required for their green card application to be approved.

6. Apply for exemplar status.

The best way to stand out from competitors and speed up application processing time is to gain exemplar status from the U.S. Citizenship and Immigration Services (USCIS). Exemplar status is a stamp of approval from the USCIS, which will make your project pre-approved -- something investors look for. The process is not easy and can take up to two years, however, investors will appreciate the shorter wait times, and a stamp of approval on your project means less work for you as the project moves along -- and peace of mind for the investor.

7. Hire a firm.

As a business new to the EB-5 program, you will have a difficult time getting the attention of investors if you do not work with an investment immigration firm. You need professionals to help you develop a viable EB-5 strategy, identify the right investors and make the important connections.

Related: What Businesses Need to Know About Immigration Visas