John Burson  edited Wednesday, August 7, 2024

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USCIS Updates International Entrepreneur Rule: New Investment Thresholds for 2024

USCIS increases investment and revenue requirements for the International Entrepreneur Rule, effective October 1, 2024, to align with economic inflation.

Key Takeaways:

• The new investment threshold for initial applications is $311,071, and the government grant threshold is $124,429.
• For extensions, startups need $622,142 in investments or government funds, or annual revenues of $622,142 with 20% growth.
• Qualified investors must show a history of investments totaling $746,571, with successful job creation or revenue benchmarks.
• Entrepreneurs can present alternative evidence of their startup’s growth potential.
• The USCIS application fee remains the same despite the new thresholds.

The U.S. Citizenship and Immigration Services (USCIS) recently announced significant updates to the International Entrepreneur Rule (IER), impacting the eligibility criteria and acceptable evidence for foreign entrepreneurs seeking to stay in the United States. These changes, effective October 1, 2024, are designed to better align with economic inflation rates and promote the growth of U.S.-based startups.

Under the IER, foreign entrepreneurs of U.S. startups formed within the last five years can remain in the United States for up to five years if their startup meets specific criteria such as funding milestones or job creation. This rule aims to harness the public benefit these startups provide, allowing them to flourish in the competitive U.S. market.

Revised Investment and Revenue Requirements

The new investment and revenue thresholds require entrepreneurs to demonstrate that their startups have received qualified investments of at least $311,071, up from the previous $264,147. Alternatively, government grants must now total at least $124,429, an increase from $105,659. These adjustments ensure that the financial benchmarks reflect current economic conditions.

For entrepreneurs seeking an extension of their authorized stay, the requirements are even more stringent. Startups must now have received $622,142 in qualified investments or government funds, created at least five new qualified jobs, or achieved annual revenues of $622,142 with an average annual revenue growth of at least 20%.

If you are considering transitioning from an H-1B visa to an EB-5 visa, our guide on H1B to EB5 offers valuable information on the process, requirements, and benefits of making this change.

Alternative Evidence for Growth Potential

In instances where the startup partially meets the investment or award criteria, entrepreneurs can present alternative evidence to demonstrate the potential for growth and job creation. This evidence can include various factors such as the number of customers, success in alternative funding platforms like crowdfunding, the startup’s social impact, the applicant’s academic credentials, or prior success with other startups. Additionally, selection to participate in established reputable startup accelerators or incubators can also be considered.

Updated Criteria for Qualified Investors

The criteria for qualified investors have also been updated. To qualify, investors must now have invested at least $746,571 in startups within the last five years, with these startups subsequently creating at least five jobs or generating $622,142 in revenue with an average annual growth of at least 20%. This change ensures that only investors with a proven track record of substantial investment in successful startups can make qualified investments.

Impact on the EB-5 Visa Program

The recent updates to the International Entrepreneur Rule (IER) by the U.S. Citizenship and Immigration Services (USCIS) are expected to have several implications for the EB-5 Visa Program, which allows foreign investors to obtain permanent residency by making significant investments in U.S. businesses.

Increased Competition

The IER’s revised investment and revenue thresholds could make it a more attractive option for some foreign entrepreneurs compared to the EB-5 Visa Program. The IER now requires a minimum investment of $311,071, significantly lower than the EB-5's minimum investment of $900,000 to $1.8 million, depending on the location of the project. This lower threshold could draw potential EB-5 applicants towards the IER.

Diversification of Pathways

The updates provide entrepreneurs with more options for pursuing their business and immigration goals. While both the IER and EB-5 aim to stimulate job creation and economic growth, the IER’s criteria might be more accessible to entrepreneurs who do not meet the higher investment requirements of the EB-5 program. This diversification allows foreign entrepreneurs to choose the pathway that best suits their financial capacity and business objectives.

For more detailed insights on investment opportunities and project evaluations, you can explore our EB-5 Investment Projects page, which highlights various ventures that align with the program’s requirements.

Potential Increase in IER Applications

The alignment of the IER’s investment thresholds with current economic conditions may lead to an increase in IER applications. Entrepreneurs who previously considered the EB-5 program might now find the IER’s requirements more manageable and appealing, potentially shifting a segment of the applicant pool from EB-5 to IER.

Shift in Investor Dynamics

Qualified investors who participate in the EB-5 program might also explore the IER as an additional or alternative investment opportunity. The updated IER requirements for investors, which include a substantial investment history and success in startup creation, could attract those looking for diversified investment options within the U.S. immigration framework.

Economic and Policy Adjustments

Both the IER and EB-5 programs aim to drive economic growth and job creation in the United States. The updates to the IER may lead to an overall increase in entrepreneurial activity, complementing the economic impact of the EB-5 program. In response, USCIS might consider further adjustments to the EB-5 program to maintain its competitiveness and attractiveness to international investors.

To understand the broader impact and trends of the EB-5 Visa Program, our article on EB-5 Statistics provides comprehensive data and analysis on the program’s performance and outcomes.

Conclusion

The USCIS's recent updates to the IER investment and revenue thresholds, along with enhanced criteria for qualified investors, underscore the agency’s commitment to fostering a robust startup ecosystem in the United States. These changes not only reflect current economic conditions but also aim to attract and retain high-potential entrepreneurs from around the world.

The updated guidance on the USCIS website is intended to provide clarity on the IER’s requirements and encourage eligible entrepreneurs to apply. Despite the increased thresholds, the USCIS application fee for entrepreneur applicants remains unchanged, ensuring that the process remains accessible.

Source:

• https://natlawreview.com/article/uscis-updates-guidance-and-increases-investment-and-revenue-thresholds#google_vignette