Buying an Existing Business for the E-2 Visa

I have the pleasure of being able to speak with people across the globe who want to come to the United States open a business and apply for the E-2 visa.

Oftentimes I speak to people who are very early in the process. People in this group often ask me if they’re able to purchase an existing business for E-2 purposes.

I tell them yes! You are able to purchase an existing business for purposes. And, in fact, there are some major benefits in doing so. But at the same time, there are some pitfalls that you need to watch out for.

In this post I cover the benefits and drawbacks of purchasing an existing business for E2 purposes.

The Benefits of Purchasing a Profitable Business with Employees

First of all, if the business is already profitable then you’ll be in a better position to show that the business will be successful in the future. Also, it may not be scrutinized as closely by the US government since the business is already doing well.

Additionally, if there are existing employees, you will be in a better position to show that the business will not be marginal. A marginal business is one that solely benefits the owner and their family. If the business that you are purchasing already has existing employees then your application is less likely to be challenged on the basis of marginality.

For an existing business, it is easier to show that you have purchased everything you need to start the business because everything is included in the purchase price. 

And last, but certainly not least, purchasing an existing business could protect you financially since you can put the purchase funds in an escrow account. The accompanying escrow agreement could say that the money is to be released to the seller in the event of an approval. In the event of an E-2 visa denial, the money goes back to you.

Those are the positives. However there are also potential drawbacks to purchasing an existing business. 

Potential Drawbacks of Purchasing an Existing Business for the E-2 Visa

For starters, if the business is losing money, the US government may question your ability to turn things around and generate a profit— unless you have relevant experience which makes that possibility more likely. 

Along those same lines, if the business doesn’t have at least three full time employees, the US government may issue a denial after reaching the conclusion that the business is marginal.

Conclusion

So, basically buying an existing business for the E-2 visa could be a great idea. This is especially true if the business is profitable, has three or more full time employees and the seller agrees to put the purchase price in escrow.

Of course, it is not always easy to find such a business. To find something that meets your needs, you could check out marketplaces such as bizbuysell or flippa.  And, of course, you should always do your due diligence and evaluate the investment. To aid in this process, you could enlist the services of a due diligence company or an investment advisor.

If you are interested in purchasing an existing business for the E-2 visa, then I recommend that you talk to one of the many talented E-2 visa lawyers that you can find across the globe.

Thanks for your time!