Business News Daily receives compensation from some of the companies listed on this page. Advertising Disclosure

Home

Immigrant Entrepreneurs: Everything You Need to Know to Get Started

Matt D'Angelo
Matt D'Angelo
Freelance Writer
Business News Daily Contributing Writer
Updated Feb 02, 2022

Finding the correct visa and analyzing your business idea are two essential steps to start a new business in the U.S.

  • Immigrant entrepreneurs have shaped the American economy for years. 
  • Obtaining a visa is a critical step, but first, you should understand which visa you need. 
  • Explore ideas with the most potential for success, and take advantage of the resources at your disposal. 
  • This article is for immigrant entrepreneurs who want to position themselves for success in the U.S.   

Immigration is the foundation of the American identity, but it’s also a cornerstone of American entrepreneurship. From industrial titans like Andrew Carnegie to modern corporate leaders like Elon Musk, businesspeople from other countries have shaped the American economy for hundreds of years. The New American Economy Research Fund found that more than 45% of the companies on the 2019 Fortune 500 list were founded by either immigrants or children of immigrants.

Despite this presence, experts say immigrating to the U.S. can be complicated and challenging. The visa application process alone can be difficult to navigate, and long processing times add to the complexity of starting or joining a business in the U.S. However, there are some crucial steps to fully understand the process and better position yourself for success once your business is up and running.

How to obtain a visa

The U.S., like any government, regulates who enters and lives in the country through a visa program. Visas are extended to tourists, students, family members and businesspeople. 

You can apply for several types of work visas. Here are some of the primary visa types we’ll explain for which foreign workers can apply:

  • H-1B
  • L-1A and L-1B
  • E-1 and E-2

Did you know?FYI: This list does not include the EB-5 visa, which pertains only to foreign investment. For a complete list and step-by-step application details, visit the U.S. Citizenship and Immigration Services (USCIS) website.

H-1B

The H-1B is a special visa for temporary workers. You’ll need at least a bachelor’s degree to qualify in some cases, and it’s most often used for highly technical work. 

Kamal Bathla, managing director of Maestro Technologies, said his company acquired another company and now sponsors a few H-1 workers. He emphasized that these workers are usually only brought in when the company can’t find an American-born employee with the skills needed for a project. This makes the H-1B visas more applicable to highly skilled workers.

“Having an ability to hire someone, as long as you exhaust all the options of hiring someone local, it’s important,” Bathla said. “That’s why you go out to hire someone [with] an H-1 – because you can’t find someone local.”

While Bathla said it was not difficult for his company to bring in a new employee, Eileen King English, partner at the New Jersey-based immigration law firm Hartington King English LLC, said that H-1 visas are a significant barrier for some immigrants because of the highly skilled nature of the requirements.

“It is a difficult route,” she said. “When you’re a foreign national, and you want to get an H-1B for yourself or for your company in the U.S., that’s difficult. … They [the visas] all have a hurdle to overcome to do it.”

L-1A and L-1B

The L-1 visa program is for company executives and “special skills” employees who need to be relocated to a company branch within the U.S. The L-1 visa can also be used to establish new branches of a foreign company in the U.S.

This visa type has two levels: L-1A and L-1B. USCIS says the L-1A program is meant to “transfer an executive or manager from one of its affiliated foreign offices to one of its offices in the United States.” The L-1B program is for a “professional employee with specialized knowledge” who needs to be transferred from a foreign office to an existing office within the U.S.

Like the L-1A visa, the L-1B has some fine print that’s important to review and understand before applying. In the case of the L-1B, the full USCIS definition of “specialized knowledge” includes knowledge of internal company processes, products, services, research, equipment, techniques or management.

Unless you’re looking to open a new company branch in the U.S., the L-1 program is for workers already employed by a company looking to send them to the U.S. for work. L-1 visas are similar to H-1B visas: The person interested in working in the U.S. must already be employed by a company with the means and corporate infrastructure to send them there.

E-1 and E-2

The E-1 and E-2 are treaty-based visas, meaning that only countries with special agreements with the U.S. can qualify for them. The list of treaty countries does not include China, Russia or India. (It does, however, include Taiwan.)

E-1 and E-2 visas are for individuals looking to come to the U.S. to start a new business or join an existing one. The E-1 visa is for “treaty traders,” while the E-2 is for “treaty investors.” You can read more about this distinction on the USCIS E-1 Treaty Traders page

E-1 and E-2 visas have extensive reporting requirements if you’re looking to use them to extend your company into the U.S., according to King English.

“The documentation required by the Department of State to show for a new office is just a high burden in terms of a five-year plan and showing the money you’ve already invested in the U.S. and how that money’s going to be used – all of those things,” she said. “It’s not a straight path.”

While the documentation may be extensive, it’s not impossible. The key is whether your country of origin has a treaty with the U.S. These visas also must be renewed every two years, depending on your specific situation. 

What to know if you’re starting a business

Jalal Maqableh immigrated to the U.S. from Jordan and works as a business advisor for the Small Business Development Center in Shenandoah Valley, Virginia. He specializes in immigration entrepreneurship, particularly helping business owners new to the U.S. get their operations up and running.

“The most important businesses for immigrants, most of the time, [are] shopping and food,” Maqableh said. “People are looking for the traditional stuff, like clothes and accessories, and the things that they used to use before coming to the United States.”

He said this tendency inspires many immigrant entrepreneurs to open shops stateside to represent their culture, and provide the kinds of goods and services available in their native country. 

Did you know?FYI: It’s also important to choose the best legal structure for your business, whether it’s a sole proprietorship, partnership, limited liability company (LLC) or corporation.

Knowing your customers and finding the right idea

Before establishing a business, Maqableh said, it’s important to identify your customer base. While it’s a good idea to open a store that caters directly to one culture, it’s possible to be even more successful by extending your business to other cultures in the community. 

This model could include providing English menus, working with community leaders and marketing the business to the general community. By setting up a business that caters to both a traditional cultural community and the broader culture within an area, business owners could maximize their reach, according to Maqableh.

“If you go to an Arabic, Halal, or Latino store and you don’t know the language and the culture, you will leave,” he said. “The culture there is preserved for the local people, but Americans like to try new things and discover new things. There is potential there if you communicate, if you have signs in your language and in English, or if you contact the local community.”

Maqableh also said that it’s essential to do some research and speak with community experts and leaders to determine if a business idea makes sense in the U.S. He gave an example of an entrepreneur who wanted to start a copying center in his local community. While copy centers can be booming businesses in some countries, there’s little demand for copy center services in the U.S. because several businesses – such as Walmart and Staples – may already provide those services locally.

When thinking about starting a business, shoot for a broad customer base and ensure there’s demand for the product or service you want to provide.

TipTip: Hiring for your startup is critical, but you don’t want to do it all at once. Hire from the top and expand your team when your resources allow.

Resources for starting a small business

If you’re starting a business, here is some helpful information on business basics that every entrepreneur should read.  

  • How to Start a Business: A Step-by-Step Guide: Starting your own business can be scary, but it doesn’t have to be. In our step-by-step guide, you’ll learn some key facets and basic processes entrepreneurs should know when starting their business.
  • 20 Mistakes to Avoid When Starting a Business: Have you ever devoted a portion of your budget to projects that just won’t work? Have you ever been overwhelmed while managing a project even though you have a full support team? We’ll give you some expert guidance to avoid common rookie mistakes in this helpful article. 
  • Tax and Business Forms You’ll Need to Start a Small Business: Incorrectly submitting your corporate taxes or being noncompliant with federal regulations can be a nightmare. Avoid those worst-case scenarios by filling out all the proper forms from the get-go.
  • Employee Handbooks for Startups: Making sure your workforce understands your corporate policies and values helps build an environment in which your team will thrive. Providing a comprehensive handbook for every new employee to understand corporate policies and procedures is a great first step.
  • What Business Startup Costs Should You Consider? Balancing your budget to accommodate your required operating expenses is one of the earliest steps you need to complete. Understanding how you should allocate funds now can help you avoid headaches later. 

Why setting up a business takes time

Maqableh pointed out that the legal processes for starting a business are likely different in the U.S. compared to some other countries. He highlighted the importance of understanding state and municipal requirements, as well as how long it takes to set up inspections and receive safety permits.

He pointed out a common scenario: “People were organizing their businesses and [think they’re] ready to open. They have the safety people coming to check the fire alarms, but because they didn’t arrange the proper permits, they’re forced to wait six months to fix the problem.”

The detailed rules and laws for starting a business vary by state and town, but it’s essential to be aware of your area’s regulations. Maqableh said that paying attention to these laws is crucial to successfully open and run a business in the U.S.

Did you know?FYI: Self-employed people should understand the basics of benefits coverage for entrepreneurs, including liability insurance and self-employment taxes.

Challenging, but not impossible

Traveling to the U.S. for work, or opening your own business once you’re here, can be difficult, but it’s doable. Take advantage of local and online business resources, stay informed about local laws and regulations, network with other entrepreneurs, and consider working with advisors like Maqableh. Success as a newly arrived entrepreneur is an excellent possibility. 

Eduardo Vasconcellos contributed to the writing and reporting in this article. Source interviews were conducted for a previous version of this article.

Image Credit:

Pra-chid / Getty Images

Matt D'Angelo
Matt D'Angelo
Business News Daily Contributing Writer
I've worked for newspapers, magazines and various online platforms as both a writer and copy editor. Currently, I am a freelance writer living in NYC. I cover various small business topics, including technology, financing and marketing on business.com and Business News Daily.