October 31, 2016 at 8:33 pm #58499
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.