Marketing your EB-5 Offering

The team marketing a regional center project must be ethical and forthright with their efforts to comply with the law, while also being strategic about the legal and financial information disclosed to investors to create a compelling offer. Public marketing materials issued in person or online must not misrepresent the project or the project sponsor. Well-planned, ethical marketing campaigns can be an important part of mitigating risks to challenges that can become big problems for issuers, including the potential need to return funds to investors or the potential for litigation. 

Deciding where to market

When figuring out a marketing strategy, it is important to decide whether to locate potential investors directly or indirectly through a middleman. This decision will depend on whether a project targets domestic or foreign immigrant investors. Even in countries where there is a lack of knowledge of EB-5, it is possible to approach wealth managers, accountants, immigration consultants, etc., who may have clientele that could be interested in this immigration by investment path. 

International Marketing

Marketing to an international audience is radically different from marketing to domestic buyers, as marketing to foreigners requires professionals who are well versed in international business customs. As a sponsor, it is necessary to have immigration agents with pre-existing connections in the target country and can make introductions to prospective investors.

Choosing Countries for Marketing

To ensure you are marketing in the right forums and with the right agents, it is wise to pre-select a country which you plan to target for investors. While targeting multiple countries may bring more investors, it is also more expensive and time consuming. Multilateral marketing requires far more agents, time, and compliance with multiple legal codes to ensure consistency between marketing in each location. 

Issuers must conduct rigorous due diligence prior to choosing foreign countries to market to, based on the availability of visas for EB-5 investors and what connections the RCs may have abroad. Precautions must be taken to avoid countries with visa backlogs, capital export limitations, and restrictions on security offerings. For example, in Iran, no EB-5 investment offerings can be sold or marketed to Iranian nationals. Many countries also have restrictions on how much capital can be exchanged or transferred internationally (known as currency controls or Article 14 countries).

Tactful research to international business customs alone may not gain favor with different audiences abroad. Connections to respectable, licensed foreign professionals who have in depth knowledge of local customs may direct the countries you target for marketing. Immigration agents, wealth managers, and foreign intermediaries are all great candidates for market connections abroad.

Selling a project to EB-5 investors 

EB-5 offerings must be incredibly competitive to appeal to the saturated EB-5 market. EB-5 investors have become sophisticated in recent years about what comprises a competitive offering. This is because their immigration status depends on having a sound and successful investment with a reputable company. 

EB-5 projects must have, 

• Compelling benefits (i.e. high chance of full repayment)
• Backing from reputable regional centers, financial institutions, and/or government agencies
• Sound business models and economic impact reports which show a high probability of project and business success
• Reasonable growth objectives
• Trusted professionals involved (business plan writers, developers, brokers, etc) 
• A favorable capital stack (including significant money contributed by banks, lenders, developer equity; or which put EB-5 investors in a favorable spot)

Establishing Trust

Using names that investors will recognize – project developer, a government agency, bank sponsors, attorneys, and investment issuers involved with the commercial enterprise – can assure investors who may be on the edge. It can be a huge relief to investors who a) have never seen the investment project; b) are making a high-stakes, expensive investment; and c) are putting their trust in an investment issuer they are most likely unfamiliar with. Support from notable names can act as a reassurance for investors who may need convincing of the value and external support for this project. If a bank or local government is willing to put their money on the line, investors may feel more safe doing the same.

If your project does not have well-known actors either financing or supporting development, demonstration of past success achieved by your team like construction, business revenue, and immigration approvals from associated regional centers can build trust among prospective investors. Trust can also be built through team members who share nationalities with prospective investors; shared cultural background is a common way that investors seek out professionals to work with for their immigration and investment, and is a very powerful force in promoting projects abroad.

Online Marketing to Investors

Online marketing is a great way to connect with potential immigrant investors from all over the world who are interested in immigrating to the U.S. through the EB-5 program. However, online marketing also requires careful planning and compliance with securities laws and regulations. Therefore, before launching any online marketing campaign, EB-5 issuers and marketers should seek professional guidance from qualified EB-5 securities law experts. Ensuring compliance with all applicable securities laws and regulations, even those of a country you plan to conduct your marketing efforts important.

One of the main challenges of marketing EB-5 securities online is the prohibition of general solicitation and advertising. General solicitation and advertising are any forms of communication that are directed to the public or a large group of potential investors, such as websites, social media, blogs, podcasts, webinars, newsletters, or press releases. Generally, EB-5 securities can only be offered and sold to accredited investors, who are individuals or entities that meet certain income, net worth, or sophistication criteria. Online marketing requires a high degree of vetting with foreign investors and their representatives to avoid noncompliance.

Done properly, online advertising can be a powerful and cost effective tool to reach the target audience that 1) has the desire to immigrate and permanently reside in the U.S., and 2) has the investment capital required to invest in this program.

In-Person Events, Conferences, and Exhibitions

A popular method of marketing EB-5 projects is through EB-5 conferences, trade and investment conventions, and large events for industry professionals. These in-person events can be great ways to meet with prospective EB-5 professionals who can recommend your project to their clients, and possibly even assist your team with offers in the future. 

Note: Not every individual that you meet at these conferences is authorized to sell or market an EB-5 project, such as immigration attorneys or professionals who are not registered with the project being sold. 

In general, it is good practice for project sponsors and management to travel to target countries to gain valuable “face time” with their prospective investors. Investors value in-person meetings and are more likely to trust an issuer if they have held a conversation with its managers, representatives, or any other service provider associated with the group.

However, some countries may be much less amenable to an in-person event. Many investors from across the world do not wish to publicize their economic status and possibly jeopardize their safety by attending an event for high-net worth individuals. This is why in-person marketing is an issue that requires knowledge of local business practices and attitudes; it is important to study the business practices of your target audience with a knowledgeable professional to ensure marketing methods are amenable to cultural business norms and also provide a comfortable, legitimate, and safe setting for the investor.