Purchasing vs. Starting an E-2 Business: Which is Better?

If you’re considering an E-2 visa to invest in the United States, you may be wondering whether it’s better to purchase an existing business or start a new one. Both options have their merits, and the best choice depends on your individual goals and preferences.  Both can be approved so the decision often comes down to what you prefer.

Advantages:

1. Established Operations: Buying an existing business means you’re taking over an operation that is already running. This can provide immediate cash flow and a clear understanding of the business’s financial health.
2. Existing Employees: An existing business often comes with an established workforce, which can simplify meeting the E-2 visa requirement of employing U.S. workers.
3. Proven Track Record: The business’s history and track record can offer insights into its viability and potential for success.

Considerations:

• Due Diligence: It’s essential to thoroughly evaluate the business to ensure it is profitable and meets all E-2 visa requirements.
• Purchase Price: Acquiring a business can require a significant upfront investment. Also, buying a business may be more expensive. You must find a business that qualifies for E-2 so this normally means one that has at least 3 employees. A business that is making money and has employees can be expensive.

Advantages:

1. Flexibility and Control: Starting a new business allows you to build and shape the company according to your vision and goals. It can also be less expensive than buying a business as you do not have to pay for goodwill or past performance of a company.   You can also control who you hire and the clients you focus on.
2. Personal Satisfaction: Many entrepreneurs find it rewarding to create something from scratch and watch it grow.
3. Tailored Business Model: You can design your business model to fit the market and your personal expertise.

Considerations:

• Initial Setup: Starting a business involves setting up operations, hiring employees, and building a customer base from scratch.
• Time to Profitability: It may take time before the new business becomes profitable and meets all E-2 visa requirements.

When deciding between purchasing an existing business or starting a new one for your E-2 visa, consider the following:

• Your Skills and Experience: Choose an option that aligns with your expertise and business experience.
• Your Goals and Interests: Select a business type that you are passionate about and eager to develop.
• Financial Considerations: Assess your financial situation to determine which option makes the most sense for your budget and risk tolerance.

Both purchasing an existing business and starting a new one are viable options for obtaining an E-2 visa. The best choice depends on your personal preferences, goals, and circumstances. Consulting with an immigration attorney can help you make an informed decision that aligns with your aspirations and immigration objectives.

If you have questions about the E-2 visa process or need help deciding between buying an existing business or starting a new one, take advantage of our free resources and book a consultation with our experienced legal team.