E-2 Visa Founder Transition: Options for Moving On - Sophie Alcorn

Navigating Immigration Challenges for Tech Founders: Dear Sophie

This is another installment of “Dear Sophie,” a dedicated advice column focused on addressing immigration questions relevant to those working within the technology sector.

Sophie Alcorn, a Silicon Valley-based immigration lawyer, emphasizes the importance of these inquiries. She states that these questions are instrumental in disseminating knowledge, empowering individuals globally to overcome geographical limitations and achieve their aspirations.

Access to the weekly “Dear Sophie” columns is a benefit for TechCrunch+ members. A 50% discount is available on one- or two-year subscriptions using the promo code ALCORN.

Dear Sophie,

I am the founder of a startup currently operating under an E-2 visa. I am actively seeking funding, a process that will inevitably dilute my company ownership. This dilution may ultimately disqualify me from meeting the E-2 visa’s ownership requirements. What alternative immigration pathways should I explore, particularly those that would also permit my spouse to maintain their employment authorization?

— Fintech Founder

Dear Fintech,

This is a pertinent concern. The E-2 visa, designed for treaty investors and their essential employees, stipulates that at least 50% of the U.S.-based business must be owned by individuals or entities originating from the investor’s country of citizenship. Additional criteria apply, but this constitutes a fundamental requirement.

Recent updates regarding immigration policy changes, some of which impact potential solutions for your situation, were discussed on my podcast. These include the International Entrepreneur Parole program and avenues for obtaining a green card.

To comprehensively assess your options, considering both your objectives and any relevant time constraints, seeking guidance from a qualified immigration attorney is highly recommended.

Visa Options for Founders

Founders often initially explore the O-1A visa, designed for individuals with extraordinary ability, or the H-1B visa for those in specialty occupations. However, spouses dependent on these visas – O-3 and H-4 holders – may not immediately qualify for employment authorization.

The O-1A visa is frequently a viable path for startup founders, especially those backed by investors. It’s known for being one of the fastest work visas to acquire, though it demands rigorous documentation. Importantly, simply holding O-3 status does not grant a spouse the right to apply for a work permit.

In situations where equity is being diluted, an H-1B visa might prove more advantageous. A cap-exempt H-1B, obtainable through a nonprofit or qualifying organization, offers a route bypassing the annual spring lottery. Securing one cap-exempt H-1B eliminates the need to participate in the lottery.

Your startup could then sponsor you for a standard H-1B concurrently, further avoiding the lottery. However, spousal eligibility for an H-4 work permit is contingent upon reaching specific stages within the green card application process.

Individuals currently in the U.S. under E-2 status should explore the possibility of filing a Change of Status with U.S. Citizenship and Immigration Services (USCIS). Premium processing is available for both O-1A and H-1B petitions.

USCIS provides a guaranteed expedited decision – within 15 business days – when premium processing is utilized. This decision will take the form of an approval, a request for additional evidence, or a denial.

It’s crucial to understand that seeking a change of status differs from applying for a visa through a consulate outside the U.S. for either single or multiple entries.

Understanding Work Permit Eligibility

• O-3 Status: Does not automatically qualify a spouse for a work permit.
• H-4 Status: Work permit eligibility is tied to progress in the green card process.
• Cap-Exempt H-1B: Provides a lottery-free pathway to work authorization.

Careful consideration of these factors is essential when navigating the U.S. immigration system as a startup founder.

International Entrepreneur Parole

Individuals who have founded a company within the last 18 months, secured a minimum of $264,147 in funding from U.S. investors (or $105,659 through government awards or grants), and retain at least 10% ownership in their venture may be eligible for International Entrepreneur Parole (IEP).

IEP provides the opportunity for you and your family to reside in the United States for up to 30 months, with your spouse qualifying for employment authorization.

Recent Improvements to the IEP Program

A significant advancement has been achieved through recent advocacy efforts aimed at enhancing the IEP program for founders. A major obstacle previously hindering the program’s effectiveness has now been addressed.

While IEP initially permits a stay of up to 30 months, U.S. Customs and Border Protection (CBP) officers held the ultimate authority regarding the duration of parole granted upon entry into the country.

Previously, CBP officers were routinely authorizing entry only in 12-month intervals.

This practice created difficulties for families, necessitating departures and re-entries into the U.S. within a year.

Furthermore, the validity period of an IEP spouse’s work permit was often limited to a few months due to application processing delays and its dependence on the length of the approved IEP stay.

Positive Changes in CBP Approval Process

It is with pleasure that I announce a positive shift in this situation! I am actively involved in a group providing the government with feedback to optimize the IEP program’s efficiency and impact.

We have recently received confirmation that CBP now possesses the capability to approve initial stays in the U.S. for the full 30-month period, rather than restricting approvals to 12-month increments.

Further Information

For comprehensive details regarding the IEP application process, please refer to a previous article in the “Dear Sophie” series dedicated to this subject.

Alternatively, you can gain valuable context by listening to podcast episodes discussing the “Parole Entry Process.”

Green Card Pathways

Obtaining a green card generally requires a longer timeframe compared to securing a work visa, with the exception of green cards obtained through marriage. The majority of employment-based green cards, including the EB-1A green card for those demonstrating extraordinary ability and the EB-2 NIW (National Interest Waiver) green card for individuals with exceptional ability, typically require a waiting period of several years.

Individuals originating from India or China may experience even more extended wait times, particularly if they haven't yet established a priority date. The availability of a green card number is a key factor influencing these timelines.

The EB-1A process generally proceeds more rapidly than the EB-2 NIW route. This is especially true given the current status of the category, which, according to the November Visa Bulletin, is current for all countries.

The Diversity Visa Program

The Diversity Immigrant Visa Program (DV Program) presents an alternative avenue for obtaining a green card. However, even with selection in the annual DV Program lottery, it can still take up to two years to finalize the process.

Currently, the registration window for the fiscal year 2023 lottery is open until November 9, 2021, at 12:00 p.m. EST.

Each year, the U.S. Department of State allocates 50,000 green cards to individuals from countries with historically low rates of immigration to the United States. The Department of State releases annual instructions detailing eligible countries for the diversity lottery registration.

Important COVID-19 Vaccination Requirement

All green card applicants must now be fully vaccinated against COVID-19 prior to undergoing their immigration medical examination, effective October 1, 2021.

A significant advantage of pursuing a green card is the associated work authorization for your spouse. Upon reaching the stage of filing Form I-485, the adjustment of status application, both you and your spouse can concurrently submit applications for work permits.

These permits enable your spouse to seek employment with a U.S. employer or engage in self-employment. For instance, founders holding E-2 visas, often from European countries, may choose to self-petition for an EB-2 NIW green card while simultaneously filing adjustment of status applications for their entire family.

We wish you success in your chosen immigration path!

— Sophie

Do you have a question for Sophie? Submit it here. We maintain the right to edit submissions for clarity and space considerations.

Please note that the information provided in “Dear Sophie” is intended for general knowledge and does not constitute legal advice. For a comprehensive understanding of the limitations of “Dear Sophie,” please review our complete disclaimer. You can reach Sophie directly through Alcorn Immigration Law.

Sophie’s podcast, Immigration Law for Tech Startups, is accessible on all major podcast platforms. She is currently accepting applications from those interested in being a guest!