If you are an entrepreneur or startup founder wanting to do business in Australia, you may have heard of the ‘entrepreneur visa’. This refers to the entrepreneur stream of the business innovation and investment (provisional) visa (subclass 188E). This visa allows you to undertake entrepreneurial business and stay in Australia for up to four years and three months. Afterwards, you have the option to become a permanent resident. This article will discuss the eligibility requirements for the entrepreneur visa and provide some tips on how to meet funding requirements.
1. Have an Invitation to Apply
To be eligible for the entrepreneur visa, you must first submit an expression of interest (EOI) to the Department of Home Affairs (DOHA) via SkillSelect. If the relevant State or Territory government accepts your EOI and nominates you, you will then receive an invitation from the DOHA to apply for this visa.
2. Have a ‘Complying Entrepreneur Activity’
You must also ensure that your proposed activity is a ‘complying entrepreneur activity’. This is defined as an activity that relates to an innovative idea that will lead to either the:
commercialisation of a product or service in Australia; or
development of an enterprise or business in Australia.
To demonstrate to the government that you meet this requirement, you must submit a written business plan. Within this proposal, you must outline your plans to commercialise or develop your innovative idea in Australia.
While there is no clear definition of ‘innovative idea’, Mr Peter Dutton (then the Minister for Immigration and Border Protection) stated in 2016 that the visa:
“will be available for emerging entrepreneurs with innovative ideas and financial backing to develop their ideas in Australia.”
The Significant Investor visa statistics show that, in the 2017-2018 financial year, only three entrepreneurship visas were granted in New South Wales.
3. Receive Funding From an Approved Entity
To ensure that your proposed entrepreneurial activity is compliant with the requirements under the entrepreneurship visa, you must:
have at least one legal agreement to receive funding of at least AUD $200,000 from an ‘approved entity’ (discussed below);
hold at least 30% ownership in the entrepreneurial entity (e.g. company or partnership) when the agreement was signed; and
ensure that at least 10% of the agreed funding must be paid to the entrepreneurial entity within 12 months of the Australian activity.
publicly funded research or innovation organisation; or
specified higher education provider.
Commonly, entrepreneurs obtain Australian funding through investors registered as an AVCLP or ESVCLP. These are registered venture capital funds that are supported by Australian Government programs.
Tips on Sourcing Funding
Like many entrepreneurs and startup founders, you may feel lost on where to start looking for funding. Further, this process can be especially tricky if you have no contacts in Australia. Below are three tips on how to go about sourcing venture capital in Australia.
Tip 1: Research
Before contacting investors, make sure that you research and understand their portfolio and target investments. Ask yourself:
who the investor is;
what they specialise in;
what investments have they made; and
why they made those investments.
You can find a list of registered AVCLP’s and ESVCLP’s on the Department of Industry, Innovation and Science website.
Tip 2: Be Prepared
It is essential that you have prepared before meeting with a potential investor. This preparation will involve having the relevant documents in place, such as a:
Approaching and meeting a potential investor face to face can go a long way. If you have the opportunity to visit Australia, make sure to attend one of the many networking events that are targeted at entrepreneurs and startups. Otherwise, a friendly message via LinkedIn could also be beneficial.
Also, do not forget to follow up any personal contacts or networks that you have in Australia.
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be under 55 years of age (unless the nominating State or Territory determines that your proposed activity will be of ‘exceptional economic benefit’);
have a competent level of English;
meet health requirements (e.g. undertaking a health examination), including family members;
meet character requirements (e.g. providing a police certificate), including family members; and
sign the Australian values statement.
If you are a foreign entrepreneur who has an innovative idea that you want to commercialise in Australia, the entrepreneurship visa might be right for you. To meet eligibility requirements, you must have funding of at least $200,000 AUD from an approved entity, such as an investor registered as an AVCLP or ESVCLP. When sourcing funding, you should:
research your potential investor to understand their portfolio and target investments;
being prepared with the relevant documents to support your idea; and
networking as much as possible, whether at networking events or on social media.