How Much Do You Have to Invest for an E-2 Visa? There Is No Minimum, and That Is the Harder Answer

Short answer. No statute and no regulation sets a minimum E-2 investment. The Foreign Affairs Manual says so in terms: “No set dollar figure constitutes a minimum amount of investment to be considered ‘substantial’ for E-2 visa purposes.” What the law applies instead is a proportion, on an inverted sliding scale. The cheaper the business, the closer to one hundred percent of its cost your investment has to be. A $100,000 business generally needs something near $100,000. A $10 million business does not need $10 million.

Anyone quoting you a floor of $100,000 or $200,000 is quoting a practice rumor, not a rule.

The proportionality test, in the government’s own words

9 FAM 402.9-6(D):

The proportionality test determines whether an investment is substantial by weighing the amount of qualifying funds invested against the cost of the business. If the two figures are the same, then the investor has invested 100 percent of the needed funds in the business; such an investment is substantial. Most cases involve lesser percentages. The proportionality test can best be understood as a sort of inverted sliding scale. The lower the cost of the business the higher a percentage of investment is required. On the other hand, a highly expensive business would require a lower percentage of qualifying investment. There are no bright line percentages that exist for an investment to be considered substantial. Thus, investments constituting 100 percent of the total cost would normally qualify for a business requiring a startup cost of $100,000, for example. At the other extreme, an investment of $10 million in a $100 million business may be considered substantial, based on the sheer magnitude of the investment itself.

And the sentence that should end the myth of a floor:

If all the other requirements for E-2 status are met as described in 9 FAM 402.9-6, the cost of the business per se is not independently relevant or determinative of qualification for E-2 status.

What goes in the denominator

The test is a fraction. Your qualifying capital over the cost of the business. The denominator is defined differently depending on what you are doing.

Buying an established business. The cost “is generally its purchase price, which is normally the fair market value.”

Creating a new business. The cost is “the actual cost needed to establish such a business to the point of being operational,” which “can usually be determined by combining the cost of the assets the investor has already purchased with the cost estimates for the procurement of additional assets needed to run the business.”

The FAM names the proof it wants: invoices or contracts for substantial purchases of equipment and inventory, appraisals of market value of land, buildings, equipment and machinery, accounting audits, and records filed with government authorities.

Note what that means for a franchise. The franchisor’s Item 7 “Estimated Initial Investment” is a published range and a useful benchmark, but it is evidence of the denominator, not the denominator itself. See Franchises and the E-2 Visa.

What goes in the numerator, and where deals fall apart

Only capital that is genuinely yours and genuinely at risk. The regulation requires the investor’s “unsecured personal business capital or capital secured by personal assets.” A loan secured by the assets of the business you are buying does not count, because you have not put anything of your own at risk. And adding personal collateral alongside business collateral does not fix it. Equipment and inventory on hand count. Leases count only in a limited monthly amount. Intangible property counts to the extent its value is reasonably determinable.

This is where an otherwise fine deal falls apart. A client tells me he is putting $400,000 into a business. We trace it, and $250,000 turns out to be an acquisition loan collateralized by the business itself. The numerator is $150,000, not $400,000, and the ratio no longer works.

The trap on the other side

Investing a small amount is a substantiality problem. Investing in a business too small to support you is a separate marginality problem, and solving one does not solve the other.

Take a $60,000 dry cleaner bought outright with $60,000 of your own savings. Substantiality is perfect: one hundred percent proportional, no debt, everything at risk. Now the officer asks the second question. The shop nets $38,000 a year, you are the only employee, and the projection you filed shows the same $38,000 in year five. That is a minimal living for a family of four, there is no economic contribution beyond your own household, and the case fails on marginality even though the money was flawless.

What would have saved it is in the regulation’s second sentence: a credible five-year plan showing either income above a minimal living or a significant economic contribution. Two additional locations. Three employees by year three. A wholesale contract with a hotel. Those are business facts before they are immigration facts, and they have to exist before the petition, not in it.

The two tests pull in opposite directions for small businesses, which is why cheap E-2 cases are harder than expensive ones instead of easier.

So what should you plan on?

The useful question is not “how much” but “how much relative to what.”

What I can tell you is what the number has to survive. It has to be traceable to a lawful source, documented account by account. It has to be at risk in a form the regulation recognizes. It has to be irrevocably committed instead of sitting in an account waiting for a visa. And it has to sit alongside a plan that answers marginality.

Those four constraints decide more cases than the size of the number does.

Tell us the business you are looking at and the money you can commit, and we will run the proportionality and marginality analysis before you make an offer. Getting this wrong is usually not a denial. It is usually eighteen months and a purchase you cannot undo. Call or text 512.761.8479.

Read next: E-2 Visa Requirements · Buying an Existing Business on an E-2 · What an E-2 Visa Costs