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Preeti Sinha

How important is it to show aggressive revenue growth for my EB-5 project?

Answers

Philip Cohen
January 06, 2016 10:22 AM  Philip Cohen

An EB-5 project is very different from other venture or mezzanine investments. A rule of thumb for VCs is that they want to see (on average) a return of 5-7 times the original investment within 5-7 years, so plausible aggressive growth is important.

In EB-5, however, aggressive revenue and growth projections do not have the same importance to an EB-5 investor as they might to other investors such as a venture capitalist. Today’s more sophisticated investors know that aggressive projections often come with additional risks. Conservative projections and core stability are more important to EB-5 investors; they simply want to know that the business will be secure enough not to fail and to create the necessary jobs and make enough money to be able to pay them back.

Marko Issever
December 27, 2017 12:27 AM  Marko Issever

Not at all. The two important things every EB-5 investor is looking for are:
first, certainty of getting the green card which first and foremost depends on required number of jobs beings actually created and
second, certainty of getting their investment back.

Making revenue out of the investment is on almost nobody's mind. On the contrary, when investors see high coupons that come with the EB-5 investments that could be the result of aggressive revenue projections that is usually a red flag. Most savvy investors shy away from those kinds of projects.

Gregory Finkelson
December 26, 2018 05:06 PM  Gregory Finkelson

It is not important to show aggressive revenue growth for your EB-5 project. Instead, you have to make sure the minimum number of jobs are created.

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