Hopefully not yet another set of H1B + Startup questions

[madohan]

I have gone through most existing threads on the topic and despite confirming certain details with a top Murthy attorney over a paid appointment, I am left with some puzzles. Hopefully I can get some clarity before going back to the Lawyer. 

 

Below are the details behind my 2 questions. Please assume that I generally understand the importance of not working actively for a startup I co-found until a entrepreneur visa is procured and prevailing wage & Startup success/legitimacy is proven. before taking any actions, I will be sure to consult an attorney and time everything correctly. In order to make your response useful, I have factored in many learnings from other research in presenting scenarios below. Kindly pardon the amount of text you are reading as a result. 

 

Current Status: H1B for specialization in civil & env engineering at a reputed A&E firm A; Approved 1-140, PD June 2011. MS in civil & env engg. from top US univ - frustrated with wait for GC with no hope fo immigration reform actionable within the next 12 months. 

 

Current Work profile: System Architect in GIS/IT 

 

Objective: Start my own product-based company X (that may use consulting gigs in the early days to pay bills). 

 

Intended Outcome (ideal): The utopia I see through an optimistic lens: Use moonlighting/volunteering time with US citizen to land on a product idea and prototype (social cause - for profit  driven) that is able to raise capital before we ever get paid a single dime (through proven product-market fit). Capital raised is enough for an incorporated holding company X to show the ability to pay prevailing wage. I get my Entrepreneur H1B available through the Aug 2011 provision. The timing of taking up an active role in the startup will be such that it is after the ability to pay prevailing wage is shown and a H1B is filed. The area of product development will not be fully aligned with my first H1B, but is still under the overall civil engineering field. 

 

Intended Outcome (Scenario 1): Startup X if founded by US citizen with me holding passive equity. US citizen works on a consulting services division under the holding company X to get a sizable consulting gig with Client C. I Leave my current firm A and jump to a reputable consulting firm D in the mean time that allows (requires) me to source my own contracts, but maintains steady payroll etc. Among other possibilities within work I do for D, I am able to work as a consultant for the startup X after disclosing my passive equity in X (D benefits from the technology collaboration with X). Since the Startup is a consulting firm and not product-based at this point, it is able to hire my consulting firm as a vendor/sub-consultant and establishes a contract to directly pay Consultancy D for work delivered to Client C. This contract is used as the basis for my H1B with D. 6-12 months go by. The startup contracts me through D to also work on a product. Product gains traction and is able to get enough capital investment to show that X can pay prevailing wage to me. I get a new Entrepreneur H1B under X and leave D to become an active equity holding H1B co-founder of X. 

 

Intended Outcome (Scenario 2): Identical to Scenario 1, except that in this case, a rich Family member, friend or fool (if lucky - Angel) invests enough $ in the Startup X such that X is able to use these funds to directly hire me through Consultancy D. Even though I hold passive equity, X is procuring the services of D. It just so happens D assigned me to work for X. My H1-B is sponsored by D in this scenario also.  

 

Question 1: Are any of the above scenarios feasible legally if the timing of actions is orchestrated well?

 

Question 2: How much money should the startup have in the form of a consulting contract, or capital investment to be able to petition for a entrepreneur H1B? 

In all scenarios described above, should the prevailing wage that the startup or consultancy is able to pay, be shown for the entire duration of the requested H1B? Like, is an open ended contract for ongoing work in an area sufficient to get 3-yr H1B extension upon transfer, or should the $ committed as wage match the $ available with contracting entity? Like I can imagine the govt will take the word of a large corporation if it provides an open ended contract, but if the source of the $ is a startup, should there be specific proof presented for the ability of the Startup X to pay for the entire 3-yr duration?

 

I appreciate your response and the time you have taken to read this. 

 

Thanks! 

-me

 

 

[JoeF]

None of your scenarios is feasible.

 

On H1, you generally can be a passive investor only. That means you can put money into a business and otherwise stay completely out of it.

You can also not work for free with some friend.

The entrepreneur memorandum would allow you to work for the company if there is an independent board of directors (not some friends or relatives you talk things over with over dinner...)

And you'd have to get paid.

And cut this "it so happens" BS out of your vocabulary. Everything would have to be by the book. USCIS is likely to scrutinize these kinds of things. If there is anything fishy or under the table or "talking things over at dinner", you'd risk a denial.

It is also very hard to impossible to get a GC through a company where the person has a significant ownership interest in.

 

If you have $1M, you can get an EB5-based GC if you invest in a business and hire at least 10 Americans. That would have to be your own money, or a loan secured with your own assets.