Synch U.S. Playbook
Get Moving in the U.S.
The Immigration Hurdle
While it is very easy to start a company in the U.S., most founders are surprised at both the difficulty of obtaining a visa to work for their new U.S. companies and by the length of time it takes to obtain the visa. While most of Silicon Valley’s success can be attributed to its global nature, with companies such as Apple, Google, Amazon, Salesforce, Paypal, eBay, Yahoo, LinkedIn, Uber, SpaceX, etc., having immigrant founders, the U.S. immigration system has not kept pace and founders can quickly find themselves caught in the archaic U.S. immigration rules without proper advanced planning. It is imperative that founders develop an immigration strategy prior to the start of the U.S. company so that the company is set up in a way to maximize the number of visa options available and to ensure the timing needs of the company are met with regard to operation plans in the US.
Overview of Visa Options Typically Utilized
The H1b visa is a non-immigrant visa for specialty occupations & professionals. It is typically granted in three-year increments for a total time of six years. Note, exceptions to the six-year maximum are only available in limited situations where applications for permanent residency are in process. This visa requires (1) that the employee have at least a bachelor’s degree in a specialty occupation (it is possible to combine education and experience to reach bachelor’s level equivalency); (2) the position for which the employee is being hired must normally require a bachelor’s degree in that specialty; and (3) the employer must pay the higher of the actual wage paid to U.S. employees by the employer for that position or the prevailing wage in the industry for that position in the metropolitan area of employment. For founders, this visa is typically only an option if the founder can show that they report to an independent board (i.e. the founder cannot have complete control of the company and decisions on his/her own). The biggest issue with the H1b visa is that there is an annual quota of 65,000 visas that can be issued per year (an additional 20,000 visas are available to graduates of U.S. universities with Master’s degrees or higher). The annual quota is typically reached within the first week of the filing period every year and the applications received are subjected to a lottery process to see which cases will be processed. In 2017: 236,000 petitions were received for the 85,000 spaces. Thus, these filings are not possible except during one week during the year and even then you have to be lucky enough to be chosen in a lottery for processing. Note, H1b transfers, amendments and extensions are not subject to the quota so hiring someone already in the U.S. on an H1b visa is an option year-round. The H1b visa is one that has been under heavy attack recently and we anticipate that this visa will be restricted even further in the coming year so any news regarding this visa is something you should definitely keep an eye on.
The L1 visa is an intracompany transferee visa. To utilize this visa, you need to have a company outside the U.S. that is a parent, branch, subsidiary or affiliate of your U.S. company. You also need to have been employed for the company outside the U.S. as either an Executive, Manager, or Specialized Knowledge employee for one out of the last three years prior to filing the petition and you must be coming to the U.S. company to work in an Executive, Managerial, or Specialized Knowledge position. For new companies, you will typically get a one-year visa initially. For Managers or Executives, the total time that can be spent in this status is 7 years; for Specialized Knowledge employees the total time that can be spent in this status is 5 years.
The E1 visa is for traders and their employees to carry on their business in the U.S. if their home country has a commercial treaty with the U.S. conferring visa eligibility (E1 is available for Norway, Sweden, Denmark, Finland, Latvia, and Estonia but not Iceland and Lithuania). The international trade must be substantial both in terms of size and volume and the trade must be principally between the U.S. and the treaty country (more than 50%). The E1 is also available to supervisory, executive or essential employees of an E1 qualified company. There is no maximum time limit on the E1 so it can be extended indefinitely as long as the requirements continue to be met.
The E2 visa is for investors who are coming to the U.S. to develop and direct an enterprise in which they have made a substantial investment in a real operating enterprise and is a national of a country that has a qualifying commercial treaty with the U.S. (Norway, Sweden, Denmark, Finland, Latvia, Lithuania, and Estonia qualify but Iceland does not). This investment may not be marginal (i.e. it must generate significantly more income than merely to provide a living to the investor and his/her family, or it must have a significant economic impact in the U.S.). The E2 is also available to supervisory, executive or essential employees of an E2 qualified company. There is no maximum time limit on the E2, so it can be extended indefinitely, provided the requirements continue to be met.
The O visa is a non-immigrant visa specifically to provide for admission to the U.S. of persons with extraordinary ability in the sciences, arts, education, business, and athletics, or extraordinary achievement in motion picture and television production, and their essential support personnel. “Extraordinary Ability” means an individual whose extraordinary ability has been demonstrated by sustained national or international acclaim (i.e. evidence that the individual possesses “a level of expertise indicating that the individual is one of a small percentage who have risen to the top of the field of endeavor.”