The E-2 visa allows citizens from 76 countries to enter the US if they invest in a US business. For individuals who are not set on investing into a particular type of business, franchises can present a great opportunity.
Franchises are businesses authorized to work within a larger business system, such as a new McDonald’s restaurant, a new Snap-On tools location, or running a Papa John’s pizza shop. For investors who are not committed to any particular business plan franchises can be ideal for a number of reasons:
- There is a clear and well-designed process for purchasing the rights to a franchise and setting up the new establishment
- The business has an established model that will allow you to understand your investment and the possible profits you may earn
- The business organization provides guidance and assistance on running your new business
Moreover, franchises are also compelling for reasons that help with an E-2 visa application:
- In an E-2 application you must demonstrate that you have made a substantial investment in order to run your business. Since franchises have established business models it will be clear whether you have taken the necessary steps to open the new business
- Since franchises are part of existing business structures you will not need to convince the consulate that you have a viable business model. While there is no guarantee any franchise purchase will be successful, by purchasing a franchise you are demonstrating that your business has a high likelihood of succeeding
- E-2 applicants must demonstrate that the investment made is proportional to the overall investment needed to operate the business. Franchise businesses have clearly delineated business start-up costs so you will be able to demonstrate clearly how the money invested thus far relates to the overall cost of starting the business
- Franchising business often provide business plans that you can use in an E-2 visa application
When starting a franchise business it often makes sense to create a holding company and then operate the franchise through a wholly-owned subsidiary. The investor would then apply for the E-2 visa through the holding company. This way after the E-2 approval if the investor wants to open additional businesses or other lines of work he/she can do so without having to amend the E-2 visa application.
For more information about how you can pursue an E-2 visa and whether or not a franchise could be a good fit for you please contact us.