International Entrepreneur Rule: A Complete Guide to the US Startup Visa
January 28, 2025
Go where you’re treated best.
We talk quite a lot around here about those five magic words.
Whether it’s placing your gold in the best countries for offshore gold storage, banking in the world’s best banks, setting up your business in a country with favourable tax policies or simply going where you can best enjoy life – ‘go where you’re treated best’ is undoubtedly the Nomad Capitalist mantra.
However, people have been following that creed for thousands of years.
People went to wherever had the best conditions for living an abundant life.
And, for several centuries, the US was a prime location for people willing to pull up their
roots in search of something better.
Naturally – despite the controversy and challenges that immigration seems to cause there – the US did, and does, benefit from all those enterprising individuals.
Today, programs like the International Entrepreneur Rule, EB-5 Immigrant Investor Program and the E-2 visa continue to attract ambitious entrepreneurs.
These visas allow innovators to establish and scale businesses while contributing to the economy.
In fact, over half (55%) of US-based startups valued at US$1 billion or more were founded by immigrants.
Are you the next founder of a billion-dollar startup? Do you need a visa to live in the United States to make that idea work?
Here’s everything you need to know about US startup visas, including what to expect when immigrating and what to know about your options, including the EB-5 Immigrant Investor Program and the E-2 visa.
Can a Foreigner Start a Startup in the USA?
Yes, technically. We will get to the specifics of what kind of visa you need to move to the US and build a startup.
But first, it’s important to understand how difficult immigrating to the US has historically been for foreign founders.
Several years back, Silicon Valley was starting to lose its appeal as the innovation capital of the world and was being replaced by new entrepreneurial ecosystems.
These innovators were looking to places like Qatar, Dubai, Australia, Singapore, Israel and India – not the US.
Opportunities are everywhere now, and foreigners don’t need the US like they did in the past.
As one technology designer in India told Vivek Wadhwa, ‘Why should I move to Silicon Valley when I have a market 10 times as large here?’
To that, we would add: Why move to the US when taxes are high and residency is nearly impossible?
Wadhwa estimates that by 2026, over 1.5 million skilled workers will be in ‘immigration limbo’ in the US.
He explains the consequences: ’Hundreds of thousands of highly skilled workers as well as the graduates of top American universities have returned home because of America’s flawed immigration policies. They are in leadership roles at top research labs and at the unicorns in China and India. America has lost an entire generation of entrepreneurs and innovators and bolstered its global competition.’
Indeed, many industry leaders and tech titans claim that the restricted immigration policies in the US keep the country from competing with the rest of the world and therefore greatly limit innovation.
Even if the number of available H1-B visas were to go up, it would do nothing to draw in entrepreneurs who want to start their own businesses on US soil.
The International Entrepreneur Rule
The issues above are part of why the White House created the IER. As we all know, immigration is a hot-button issue in the US.
So, while President Obama’s common-sense immigration reform plan always included a ‘startup visa’ for international entrepreneurs, the bipartisan immigration bill that passed the Senate in 2013 got shot down in the House shortly thereafter.
After that, the Obama Administration made a last-ditch effort to create some form of the original plan, within the extent of Obama’s executive legal power.
Through the Department of Homeland Security (DHS), a President has parole authority, meaning he or she can grant temporary entrance into the US to certain individuals.
On August 26, 2016, DHS proposed the IER, allowing foreigners to enter or remain in the US to work at qualifying startups. It was passed in 2017 but was then repressed under the Trump Administration as he tried to squash it.
This resulted in only 30 filing attempts and one approval between 2017 and 2019.
Luckily, the Biden Administration brought back the rule in May of 2021 and foreign entrepreneurs can again be hopeful (at least for now but with Trump once again holding office, he may shake things up again).
While the IER program is not a real startup visa program, it does offer an immigration solution. It is an entrepreneur parole of sorts.
However, it is essential to note that those who use it will not be granted an actual visa, visa stamp or green card. As Wadhwa puts it, ‘this is not a slam dunk for entrepreneurs wanting to come to the US – and it provides no clear path to permanent residency.’
Still, it’s better than nothing.
And there are other startup visa options that can help you move to the US and set up your business, including the EB-5 Investor Program and E-2 visa, which we will explore down below.
How to Qualify for the US ‘Startup Visa’ Under the IER Program
If, despite its limitations, the US is still the best place for your particular startup, here’s what you need to know about the IER program and how to qualify. It will be granted on a case-by-case basis for entrepreneurs of existing startups that meet the following criteria:
- Your startup provides a significant public benefit and has substantial and demonstrated potential for rapid growth and job creation
- Your startup was formed in the US within the past five years
- You possess substantial ownership interest in the startup
- You have a central, active role in the startup
- Your startup has received a significant capital investment from established US investors
- Your startup has received development awards or grants from the government.
Regarding financial requirements, updates were made effective as of October 1, 2024:
- If relying on an investment from a qualifying investor, the amount increased to US $311,071
- If relying on a government award or grant, the amount increased to US$124,429
- The revenue amount for consideration of re-parole increased to US$622,142
- Total investments in startups must equal at least US$746,571 (up from US$633,952) within five years
- At least two startups must have created five or more jobs or generated US$622,142 in revenue with 20% annual growth.
Up to three entrepreneurs per startup can be granted IER parole, and the spouses and children of the entrepreneur may also be eligible.
However, while the IER parole can allow you to reside in the US and work on your startup, as Wadhwa previously stated, this parole is not a long-term solution.
Unfortunately, it can be terminated at any time by the Department of Homeland Security (DHS), and it doesn’t provide a path to permanent residency.
That means that all entrepreneurs need to plan for beyond the allowable parole time frame and see if they can qualify for any other type of visa, given that they want to continue to stay in the US.
Complete List of Documents When Applying for the International Entrepreneur Rule
As with any other visa, especially in the United States, applying for the International Entrepreneur Rule requires a well-prepared set of documents to establish your eligibility.
US Citizenship and Immigration Services (USCIS) will carefully assess the relevance and validity of each item you submit, so it’s incredibly important to include clear, organised and compelling evidence to build a strong case.
Here’s what you’ll need to prepare:
Proof of Ownership and Role
- Articles of incorporation, equity certificates or ledgers to confirm your ownership percentage in the startup
- Employment agreements or letters from founders demonstrating your central role and detailing your responsibilities
- Organisational charts highlighting your position within the company’s structure.
Startup Formation and Activity
- Company registration documents showing the startup was established in the US within the last five years.
- Operating agreements and articles of formation outlining the business structure and compliance with startup definitions.
- Business plans or pitch decks documenting your strategy for growth and market relevance.
Evidence of U.S. Investment or Funding
- Investment agreements or bank records showing proof of receiving qualified funding, such as US$311,071 in capital investments
- Grant or award letters that demonstrate evidence of at least US$124,429 in government grants.
Proof of Growth Potential
- Customer contracts or purchase orders indicating active business operations and demand.
- Market research data or endorsement letters validating market potential and external support.
Demonstrating Your Qualifications
- Resumes and letters of recommendation detailing your experience and expertise relevant to the startup.
- Patents or certifications showcasing innovation and industry contributions.
Additional Documentation
- Personal identification and immigration records, including passports, visas and any relevant I-94 forms
- Financial statements reflecting the business’s health and progress
- Evidence of job creation, which can include payroll or hiring records proving US labour impact.
Organising and presenting these documents effectively can make all the difference in gaining USCIS approval. Also, be prepared to provide further documentation as requested.
How Much Does the International Entrepreneur Rule Cost?
The International Entrepreneur Rule does not have a fixed application fee, but you will definitely need to anticipate various associated costs.
As mentioned, you must provide evidence of qualifying investments or grants which require significant financial backing, such as capital investments of US$311,071 or government grants of US$124,429.
Additional expenses may include legal fees, visa documentation or compliance with specific business requirements to meet the program’s eligibility standards.
It’s important to note that while the IER is not a traditional US startup visa, its financial obligations primarily involve preparing the necessary proof of substantial economic benefit to the United States through the entrepreneur’s business activities.
How Long is the Processing Time for the International Entrepreneur Rule?
It depends, unfortunately. The processing time for the IER program varies largely depending on several factors, such as the complexity of the application and the caseload at the US Citizenship and Immigration Services (USCIS).
Typically, we suggest you prepare for a timeline of several months to receive a decision, as USCIS must thoroughly evaluate the documentation provided, including proof of potential economic impact and qualifying investments or grants.
Additionally, extensions up to 2.5 years for continued ‘entrepreneur parole’ may require further processing. Plan accordingly.
The IER Program Doesn’t Mean the System is Completely Fixed
The new IER program will mostly help foreign students who began working on a venture, new technology, or product while in the US, but cannot continue their work due to the limitations of student visas and the visas available after graduation.
Unfortunately, it will not solve all the issues with the US immigration system. For instance, many graduates depend on H1-B visas.
However, due to the low number of available H-1B visas, thousands of talented, educated workers are kicked out of the country each year.
Just look at these Penn State students who were sent packing the moment they graduated.
In 2019, there were more than 188,000 high-skilled foreign workers who received the H-1B Visa in the US. However, in 2020 during the pandemic, that number dropped drastically.
While the current administration is taking steps to address the immigration agenda and dig out from the mishaps of the previous one, the US economy is losing out on all the benefits the foreign-born tech and entrepreneurial talent could bring – whether they contribute to existing businesses or create their own.
Sure, the IER will allow people to stay, but most immigrant entrepreneurs are only successful at getting their businesses off the ground after they get residency.
Who’s going to invest in a company when the founder may eventually have to leave the US?
For example, one successful immigrant entrepreneur had to wait seven years for his visa before he could officially launch his tech start-up, valued at US$1.9 billion. In my book, that’s an immigration system that is seven years too slow.
In the end, there’s no doubt that the US needs better immigration reform before becoming a truly attractive place for foreign-born entrepreneurs.
Other US Startup Visas for Foreign Entrepreneurs
When considering alternatives to the ‘new’ US startup visa, the EB-5 Immigrant Investor Program and the E-2 visa are popular pathways for foreign entrepreneurs.
The EB-5 Immigrant Investor Program is an ideal route for those seeking permanent residency. By making a minimum investment of US$800,000 in a targeted employment area or US$1,050,000 in other areas, entrepreneurs can secure a green card.
Along with stimulating economic growth, this program requires creating at least 10 full-time jobs for US workers.
If you meet all those requirements, the EB-5 visa is a great pathway to permanent residency and a potential pathway to citizenship. As a plus, it extends the same privileges to your spouse and unmarried children under 21.
To learn more about this visa and how to apply, read The United States EB-5 Visa: the Ultimate Guide.
On the other hand, the E-2 visa offers flexibility and a quicker entry.
While it’s a non-immigrant visa, it allows treaty country nationals to invest substantially in a US business. The E-2 visa does not have a strict minimum investment threshold, making it more accessible for those who prefer smaller-scale ventures.
Spouses and dependents can join the entrepreneur in the US, with spouses eligible to work and children able to attend schools.
The key difference lies in scope and permanence – while the EB-5 opens a path to citizenship, the E-2 offers mobility and renewable access to the US market.
To learn more about the visa and how to apply, read How to Get a US E-2 Visa: The Ultimate Guide.
Moving Beyond the United States for Startup Visas
Until there are easier, more robust startup visa programs in the US, the country will continue to lose entire generations of entrepreneurs and innovators to the rest of the world.
While this is a huge loss for the US, it’s not a loss for the entrepreneurs who will take their talent and innovation with them to places where they’ll discover even more opportunities than the US could ever offer.
There will always be people around the world who want to come to a developed country to work.
Many of those workers would be willing to go to Canada, Europe, Hong Kong, Australia or any number of other places.
And many of them are realising that emerging and frontier markets may offer the greatest opportunities of all.
The global economy is far more competitive these days, and the Singapores and Hong Kongs of this world are increasing as countries realise the incredible benefits of efficiency, pro-business policies and attractive immigration systems that allow the best and brightest into their borders.
In the grand scheme of things, the US is becoming just another dot on the map for many foreigners. Talent, like capital, goes where it is treated best.
Is the IER Program Right for You?
If you’re an entrepreneur who wants to create a startup in the US, then the IER program might just be your ticket. Especially if you already have access to US investors.
While it’s not a perfect program and it doesn’t directly lead to permanent residency, it can help you get started in ‘the land of the free.’
However, it will be important to keep in mind that immigration laws are constantly changing, and each Administration will have its own agenda on this topic.
If you want to investigate strategies to create the perfect location for your startup – in the US or elsewhere – contact Nomad Capitalist today.
We’re ready to help.
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