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How to Start a Company on an H-1B Visa

Published on
September 26, 2022
Do you have a startup idea you'd like to explore more while working in the U.S. on an H-1B? If so, this is the guide for you!
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How to Start a Company on an H-1B Visa

This is a guest post from our friends at Legalpad!

Do you have a startup idea you'd like to explore more while working in the U.S. on an H-1B? If so, this is the guide for you!

Introduction to the H-1B Work Visa

The H-1B, like most work visas, is tied to a specific employer. While in the U.S. on the H-1B, you can only work for the company that sponsored your H-1B.

Launching a U.S. company while working for another employer on the H-1B is possible. You can incorporate your company, raise funding, go through accelerators, and meet with prospective clients. However, you cannot work for the company unless you secure work authorization. 

Four Things to Keep In Mind When Launching a Startup on an H-1B Visa

If you are exploring launching a startup and transferring your H-1B to your startup, here are four things to keep in mind:

  1. Valid job offer: To file an H-1B transfer, you must have a valid job offer at a company incorporated in the U.S.
  2. Employer-employee relationship: Even if you found your own company, you'll need to demonstrate an employer-employee relationship by owning less than 50% of the company or establishing a Board of Directors. 
  3. Specialty occupation: To work on an H-1B, you must be offered a job that requires at least a Bachelor's degree in a related field. In addition, you must have the required degree. For example, if you will be the Chief Finance Officer (CFO), the position must require at least a Bachelor's degree in Business, Finance, Accounting, or related. You must also demonstrate that you have one of the listed degrees or a degree and/or work experience equivalent to a related degree.
  4. Prevailing wage requirement: Your startup must be able to pay you a salary that meets or exceeds the Department of Labor's minimum wage level in the U.S. county where you will work.

Step By Step Process For Launching a Startup on The H-1B Visa

Step 1: Launch your startup while employed at your original H-1B sponsor

You can continue to work for your current employer on your H-1B during the first stages of your startup. During this time, you can incorporate your company, secure any business licenses required in your area, establish an office space, raise funding, go through an accelerator, hire employees, and more. However, you cannot begin working for your company yet. 

Step 2: Act as a passive shareholder.

Once your company is set up, you can continue to work for your H-1B employer until you are ready to make the transition. You cannot have an active role in running your company during this time, but you can draw passive income from the company as an investor/shareholder. 

Step 3: File an H-1B petition sponsored by your startup.

Once you are ready to transition, your startup can sponsor an H-1B transfer petition. 

You may be able to start working for your startup right away without having to wait for the H-1B approval. However, you may want to wait for the approval notice before making the transition in case your transfer petition is unsuccessful. 

Other Visa Options for Startup Founders

If you are in the U.S. on an H-1B and want to launch a startup, an H-1B transfer is certainly something you should consider. However, it is not your only option! A few other options include:

  • O-1 Visa: The O-1 is favored for its unlimited extensions and flexible criteria. The good news? Many venture-backed founders qualify for the O-1 visa without even realizing it!
  • E-2 Visa: If you are from a treaty country, you may be able to secure an E-2 visa by investing in your company.
  • EB-2 NIW or EB-1A Green Card: Why even bother with a visa when you can obtain permanent residency in the U.S. through a green card? The EB-2 NW and EB-1A are immigrant petitions that can get you on the path to getting a green card. 

There is no one-size-fits-all immigration solution. Immigration is highly personalized, so it's crucial to seek one-on-one support. Our friends at Legalpad love to partner with founders and support them throughout their immigration journeys. Whether your startup is just an idea or you've already launched, you can get started with Legalpad today.

Doola's website is for general information purposes only and doesn't provide official law or tax advice. For tax or legal advice we are happy to connect you to a professional in our network! Please see our terms and privacy policy. Thank you and please don't hesitate to reach out with any questions.
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Annie Blay
Content Specialist at Legalpad
Content Specialist at Legalpad

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