Dear Sophie: I live in Europe but want to move my startup to the US

“Dear Sophie” is a collaborative forum hosted by Extra Crunch and curated by Sophie Alcorn, who is certified as a specialist attorney in immigration and nationality law by the State Bar of California Board of Legal Specialization. Sophie is the founder of Alcorn Immigration Law, the fastest-growing immigration law firm in Silicon Valley and 2019 Global Law Experts Awards’ “Law Firm of the Year in California for Entrepreneur Immigration Services.”

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Dear Sophie: I live in Germany, but I am a Hungarian citizen. I’m worried that I won’t qualify for an O-1A visa because I’m definitely not famous or a genius. I want to move my startup to America so we can access investors and the North American market. Because I am Hungarian and not German, I don’t qualify for an E-2 investor visa. Is there any way I can pull off moving to the States and growing my company over the next two to three years? 

— Hopeful in Hamburg

Dear Hopeful: You are not alone! If your dream is to move to the United States, you can definitely make it happen through your existing company in Germany. It’s going to take some basic planning and then a little bit of time to lay the groundwork. I’ll walk you through the basic requirements so that you can get an idea of what’s ahead of you, but if you need individual specific legal advice, you should ask an attorney. For now, I hope this helps.

The first thing the United States government will want to see is that you have a registered company here. It could be any type of company, even an LLC in California. However, startup investors usually prefer a Delaware C corporation. If you don’t yet have a company registered in Germany because you are very early stage, then you could also consider having the Delaware corporation be the parent company of any future legal entities in Europe. Talk to a corporate attorney about the right choice for you.

From the immigration perspective, all of this is necessary because of the main requirements of the L-1A visa for intracompany transferees. These requirements demand that a U.S. and foreign company have a qualifying relationship for an employee transfer, such as a parent/subsidiary, a branch or an affiliation.

If you already have a company such as a GmbH in Germany, then you’ll want to talk to a corporate attorney if you’re considering making a Delaware C corporation the parent company to appeal to U.S. investors. A corporate attorney can explain the “Delaware flip,” which ensures that the investors from the German entity have equity in the U.S. company. The Delaware flip isn’t usually worth the effort unless you’ve raised some initial capital and your investors require it as part of their investment. For immigration purposes it’s not usually necessary, but it’s good to know about it if it might apply to you one day. You just need to talk to an immigration attorney to ensure you have a qualifying relationship for an L-1 visa.

To qualify for an L-1A visa, you also must demonstrate that you have spent one year of the last three working as an employee of the German company as a manager or an executive. If you have taken any trips to the United States during the accrual of this time, it pauses (but does not restart) the clock.

Ideally, you’ll have regular pay stubs showing your employment by this German company, and you’ll hire other people in Germany as employees. By the time you are ready to apply for your visa, other things the U.S. government will look for is that you have been doing business in the United States, that you have revenue in your Delaware corporation, that you have paid all taxes, and you ideally have at least a few hundred thousand dollars in your U.S. bank account.

You should also have a physical office location in the United States. Investors love it if you have offices in places like WeWork because co-working spaces are great for scaling, employee retention and minimizing unnecessary overhead. However, the U.S. government officers who typically adjudicate these applications are often unfamiliar with startups and expect companies to have traditional brick-and-mortar offices. So, make sure you talk to your attorney about this when you’re ready to get an office.

And, hopefully, you’ll also have several employees in the United States before coming here so you can demonstrate the executive and managerial duties that you will need to fulfill in your role here if you’re planning on being the CEO. You can also plan to hire these U.S. employees after you arrive, but there will be more scrutiny on your L petition if you make that choice and your visa might have a shorter duration.

If your startup goal is world domination, then you definitely need to be in the U.S. for market access and investors to support you in scaling rapidly. If you lay the basic groundwork along the way, you might be able to get a visa (and hopefully a green card too — but that’s another conversation!) in the process. Viel Glück!

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