hey everyone welcome back to my channel this is Adrien Panda business and immigration attorney and today we're going to talk about purchasing an existing business for your E2 Visa so often people forget that you don't have to start a business from scratch to qualify for an E2 Visa I assume part of the reason is that so much of the information out online about E2 visas explains how you have to make that substantial investment how it has to be committed at risk you have to purchase all of these whether it's inventory leasing space Etc and and
people get very focused on that however there's an alternative where you don't have to do all of this in which you purchase an existing us business and do not have to actually plan out what you're going to invest each and every dollar in but rather that purchase price of the business is what has has to meet the E2 requirements so basically the by purchasing the business right you have to the purchase price has to meet that substantial investment requirement and then any business plans and additional information provided will explain how you will direct and develop
this business how will you scale it how will you be able to continue to operate it right profitably now here are the advantages and disadvantages of of purchasing a business for for E2 Visa purposes so the biggest advantage is is what I just said right you do not have to spend so much time figuring out how your specific business plan meets the E2 visa requirements because you don't have to independently go acquire or lease commercial space if you need it or purchase the relevant you know inventory or equipment or or whatever it may be right
when you're starting from scratch there's just a lot of planning um so basically it simplifies the process on the on the initial planning part Additionally the documentation frankly is easier for when an existing business is being purchased because you will show the contract right usually these are structured as asset instead of stock purchases but the bottom line is you will have to demonstrate the the valid contract that you purchased the business right um then you will have to show docu and obviously the payment related to that contract right because you have to show the substantial
investment but the moment you have that you're showing you can show immediately where the funds are invested and then the additional documents will focus on the business's prior year profit and loss statements tax returns Etc to show how the business is doing right and to show how you will comply with the other E2 visa requirements such as marginality um and all other requirements simply put it's just less documentation at the E2 Visa um application Phase and also it's easier to demonstrate how you have met all requirements especially if that purchase price of the business was
High um and and it's just simply put a simpler E2 visa application in my experience that being said when you're purchasing a business to qualify for an E2 Visa there's a lot of important steps and a lot of work that needs to be done prior to the E2 Visa so first and foremost you're purchasing an existing business you need to do due diligence make sure on the investment side right like you're actually making a Sound Investment um Additionally you have to acquire it and there's several ways to do it you can structure it as a
stock purchase where you actually buy the company you can structure it as an asset purchase where you're not buying the company you're creating your own company and and just buying the think of it as buying the business from within the existing company but all of this needs to be planned out there's tax aspects to this there's also business liability aspects so as someone who works on the deal side not just on the E2 Visa side often frankly to do this properly and to be able to help a client acquire that business requires a lot of
work and it's not necessarily less time than the E2 Visa applic additional work work on the E2 visa application when you're starting a new Venture from scratch Additionally you have to actually find a business you want to purchase which sometimes if you're lucky can be a very quick experience but often I've had clients look for the right opportunity for the right purchase for many months sometimes even years right so so that will take time now if you have that time not an issue but but keep in mind that the worst thing you can do is
is try to rush purchase a business a few years ago I had a a case where uh the clients wanted to move very quickly on purchasing a restaurant in the US and because we were helping on the on the deal side um we figured out that the the broker wasn't sharing information about the underlying lease and what ended up happening is we figured out that um the owner of the property right on which the restaurant was sitting was actually planning to develop a condo on it so the client if we hadn't done all that due
diligence and all that careful um plan almost bought a business that couldn't have operated in the location where it had tremendous success in the previous years so bottom line is make sure you invest and plan out and hire the right professionals right who can help with the actual business purchase the other disadvantage I see with these cases is that you're kind of locked in to the business's past performance now obviously through your business plan and explaining what you will do with the business you can demonstrate if you're buying a an unsuccessful business you can still
demonstrate that you qualify for an E2 as long as you have a good plan on how to scale it but generally speaking if you're buying an existing business that business already has tax returns profit and loss statements that you will need to submit to the US Consulate and the console officer will see so so often what I see is and I see this a lot with private Equity type e2v applications where the investors the clients they see an opportunity in a mismanaged business and the business isn't doing so well but they know with that with
their expertise with their team they can come in and scale that business well you need to be able to demonstrate that to the officer and unfortunately the officer will look at past performance so in those cases the business plan and explaining what you will do with this business becomes absolutely critical now that being said um I've hand I've done many of those cases and and there's not explaining that you will be able to add value to a business and scale it is not the end of the world but you should keep in mind that unlike
a brand new Venture where you have a blank canvas you can draw on and you can explain your plan when it comes to purchasing a business it the there's already a piece of the canvas that's filled in and those are the past year's tax return and the business performance to sum up this video buying a business uh and qualifying for an E2 Visa is a fully viable option you should whether or not you should pursue this um depends on your goals and I'm kind of repeating this in each video I'm recording but but rather than
reading somewhere or listening to someone that says oh this is better than starting a new Venture because it's faster and you can easily demonstrate the substantial investment well it's not quite that simple and the bottom line is you should look at your goals if you have a business in mind you want to purchase an existing business that is your goal you've seen um you've identified a business that that you like and you you know started negotiating and want to purchase it well amazing then this is a very viable option and could be to your advantage
if you're only doing this because you read somewhere that it's way faster or way better than starting a brand new business well then it may not be the best option in that case you should think about your goals and try to figure out what fits your E2 Visa plan in the best way anyway I hope this video was helpful again please like the video if you found it helpful and subscribe to the channel and I'll continue to post videos that are hopefully helpful thank you so much for watching bye [Music]
