Startup financing options for noncitizen business owner
I received a question from a reader today who is opening a gym/fitness center. He needs $150K to get started for equipment and working capital. He is aiming to get the business started within 10-12 months and has $100K of his own money to invest. He’s not a US citizen–he is in the US on a visa.
He asked me the following questions:
Who would I reach out to about Visa requirements for starting up a business in the USA? Assuming I’ll need legal counsel.
It’s best to ask a business attorney for advice on this. Click here for help finding a business lawyer. Services like Avvo allow you to find local legal help and ask simpler legal questions online.
Assuming I need $150k+ and I want to retain as much equity in the business as possible, what’s the likelihood of a bank willing to lend $150k to a start-up and a non-US Citizen? I have no debt, other than month-to-month Credit Card debt (paid off monthly), and my credit score is over 700 right now.
It will be an uphill climb, but there are options. With a good credit score and a down payment, you may be able to get a startup business loan from a bank. Under certain conditions, the Small Business Administration (SBA) will also lend to non-citizens who are financing businesses based in the US (though you may need to be in business for a few months first). Find out more here.
Sounds like my other options would be VCs, Angel Investors, Crowdfunding.
Do VC’s typically lend out via debt-financing, or is is purely equity financing?
Some venture capitalists will offer debt financing, but this is usually reserved for well established companies that have a revenue built up already. If you’re interested in debt financing, another route is debt crowdfunding or peer2peer platforms.
Disclaimer: We spend hours researching and writing our articles and strive to provide accurate, up-to-date content. However, our research is meant to aid your own, and we are not acting as licensed professionals. We recommend that you consult with your own lawyer, accountant, or other licensed professional for relevant business decisions. Click here to see our full disclaimer.
Product or company names, logos, and trademarks referred to on this site belong to their respective owners.