Last Updated on May 11, 2024 by Anda Malescu
This article answers frequently asked questions about the minimum investment you need to qualify for an E-2 visa. As a foreign investor you must consider the E-2 investment amount you have available to invest along other requirements before you submit your E-2 visa application to establish a new business or purchase a pre-existing business in the US.
The E-2 visa is a nonimmigrant visa that allows a foreign investor from an E-2 treaty country to live and work in the United States together with his or her family in exchange for making a substantial investment in a US business. With the E-2 visa, the foreign investor or entrepreneur can come to the United States to be self-employed and direct and develop the US business. The investor can choose to invest in a startup business, a pre-existing business or purchase an already existing business or franchise.
To learn more about the E-2 visa and requirements, visit our E-2 visa page and What are the E2 visa requirements?
But one of the most important questions to consider when pursuing this visa is how much do you need to invest to qualify for an E-2 visa? This article discusses important considerations about the E2 visa minimum investment.
What is the E-2 investment amount?
There is no required minimum investment amount to qualify for E-2 visa. However, your E-2 visa minimum investment amount must be substantial and irrevocably committed to the US business. Although there is no set minimum investment required for the E-2 visa, regulations provide that foreign investors must invest a substantial amount of capital to qualify for E-2 visa.
Because there is no minimum investment amount required, the key is to determine the minimum investment you can make that is substantial enough to qualify you for the E-2 visa.
Generally, the E-2 visa minimum investment recommended is $100,000 or more. However, our experience shows that you can obtain an E-2 visa with a lower investment amount, but your investment should not be less than $50,000.
It is important to understand that there is a risk associated with investments lower than $100,000. However, lower investment amounts can qualify for an E-2 visa especially when considering the nature of the business and industry, access to additional capital, percentage invested of the total cost and others. Our immigration lawyers have successfully secured E-2 visas with investments as low as $50,000.
The E2 minimum investment required depends on several factors, including:
The E-2 visa investment must be substantial
While US regulations do not set a specific dollar amount as a minimum E-2 investment, the regulations state that the investment must be substantial.
From a practical standpoint, a substantial amount is an amount that once invested can ensure the success of the business and is large enough to guarantee that the investor is unquestionably committed to the success of the business.
From a legal standpoint, substantial in the E-2 visa context must be ”a substantial amount…as distinct from a relatively small amount of capital…solely for the purpose of earning a living.”
The regulations clearly state that no set dollar figure is considered substantial. Instead, if an E-2 investment is substantial is determined using a proportionality test among other factors.
A substantial E-2 investment amount is an amount that is:
- Substantial in relationship to the total cost of either purchasing an appropriate proportion of an established business or applying funds to create a new business as determined by the proportionality test
- Sufficient to ensure the successful operation of the business through investor’s financial commitment to the business; and
- Of a magnitude to support the likelihood that the investor will successfully develop and direct the business.
These factors are used to determine when an E-2 visa investment is substantial in light of the nature of the business and its projected success.
For example, if you want to open a cleaning service business, a yoga studio or an online business in Miami, an investment of around $100,000 is likely substantial for E-2 visa purposes. However, $100,000 is not substantial if you plan to open a club in Miami Beach because the amount required to start a club is substantially more than $100,000.
Proportionality test for E-2 minimum investment
The proportionality test determines if an E-2 investment is substantial by weighing the amount of funds invested against the cost of the specific business. The test focuses on comparing two things:
It is important to understand that not all businesses are equal and the value of the business is dependent on the nature of the business. This means that certain businesses such as manufacturing businesses or hotels can cost millions of dollars to purchase or establish, while others such as online businesses, marketing firms, business consulting, IT consulting companies and software development have lower startup and purchase costs.
To adjudicate the E-2 visa and determine if your investment is substantial, consular officers will calculate the value of the business and compare it with the amount of the funds or assets you actually invested in the business to determine the percentage of your commitment.
If the funds invested in the E-2 business equals or exceeds the value of the business, then the investor has invested 100% of the necessary funds, demonstrating a substantial investment even for smaller businesses with a value below $100,000. However, in most cases investors spend a lower percentage of the required capital before applying for the E-2 visa.
E-2 minimum investment for existing business
If you are purchasing an existing business for E-2 visa, then the value of the business is generally the purchase price (fair market value).
E-2 minimum investment for startup
If you are setting up a new business for E-2 visa, then the value of the business is the actual cost incurred to establish the business to the point of being operational. Typically this is represented by the total startup expenses.
How much to invest for E-2 Visa?
The proportionality test is a sort of inverted sliding scale. The lower the cost of the business, the higher the percentage of investment is required.
Lower-cost businesses require a higher investment percentage to be considered substantial.
Even with a lower investment from you, businesses with very high costs can still qualify for a substantial investment.
Businesses with very high costs can qualify for a substantial investment with a lower investment percentage compared to lower-cost businesses.
While there is no set percentage to determine if your E-2 visa investment is substantial, our experience suggests that for businesses valued at $100,000 or less, an investment ranging from 50% to 100% of the business value is typically expected. On the other hand, if the value of the business is $1,000,000 or less, a lower percentage of investment may qualify.
For example, if you start a business which has a startup cost of $50,000, then you should expect to invest close to the entire $50,000 (100% of the necessary funds) for the investment to be considered substantial. Conversely, if you plan to open a 20-room hotel in Miami, Florida which requires a total investment of $1 million, then an investment of $300,000 or more may be considered substantial.
Malescu Law can assist
For more information and guidance on the meeting the E-2 visa minimum investment requirement, contact our E-2 visa lawyers in Miami, Florida USA or book a consultation.
Our investor visa lawyers in Miami, Florida USA assist investors and entrepreneurs with E-2 visa application, E-2 business plan, E-2 business selection and franchise and other aspects of the E-2 visa process.
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