The whole point of seeking the cooperation of EB-5 Agencies is to harness
the potential of their established market area. High net worth individuals
tend to gravitate toward and live in or near major cities, because that is
where they will find the most customers and the larger labor pools for their
existing enterprises. Using the same logic, it is likely that a potential EB-5
investor will attempt to contact an EB-5 Agency near his residence or
business. The larger the population of a city, the greater number of potential
investors are likely to live there. The greater the number of potential
investors there are, the greater the number of EB-5 Agencies that exist to
service them.
Do not approach Agencies the first time with selling your project as your
primary objective. Your primary objective is to qualify Agencies to actively
and accurately represent your projects to their clients. Do not allow yourself
to be smitten as you were when you first met your spouse. This is not a
marriage that you are entering into, it is a business arrangement.
Frankly speaking, you are, in effect, interviewing potential “employees.” If
you were hiring an employee to represent your company in a critical
position, you would not hire the first person to come through the door, nor
would you hire on a single interview. You would process what you have seen
and heard, and you would perform a background check. Qualifying an EB-5
Agency’s capabilities should involve a similar process.
LET’S REVIEW
Larger Agencies will be located in large cities.
More Agencies will be located in large cities.
More potential investors will be located in large cities.
The location and size of an Agency is not necessarily an indicator of
its capabilities or its integrity.
The location and size of an Agency is an indicator of potential reach
and sphere of operation.
Evaluating By Interviewing
Understand that you are going to be fed a lot of visuals, such as brochures and
photos. That’s fine. There’s nothing wrong with that. However, think about
that vacation you took to Hawaii. Remember the good looking model sitting
by the pool in the travel brochure? She wasn’t there during your trip, was she?
The point here is to be discerning. One way of doing that is to not take
brochures and PowerPoint presentations at face value, but seek verification
of what you are presented, preferably from someone other than the Agency
staff you are interviewing.
Experience counts. There is some credibility to the idea that the longer an
Agency has been in the EB-5 business, the more credibility it should have. On
the other hand, longevity is not necessarily a reflection of integrity or
expertise. Honest, experienced people start new businesses every day. Just
because an Agency is new does not mean that its ownership or staff are
inexperienced.
Ask to see examples of some of their marketing efforts, but remember that
they are only going to show you their success stories. Ask to see their
marketing collateral and examples of how they manage full-blown marketing
campaigns. Try to determine the extent of their reach. Take some time to do
your homework by investigating to determine if they have a good reputation
among HNWIs.
There are four important things to ascertain at this point in the process:
1. Is this Agency able to expose my EB-5 project to enough qualified
candidates?
2. Will they expose my EB-5 project to enough qualified candidates?
3. Are they able to communicate my EB-5 project thoroughly and
without misrepresentation so that candidates are not ultimately
dissatisfied?
4. Is the welfare of the clients their highest priority?
You might also want to ask and answer the question, “Are they legally
allowed to execute a deal?” For example, there is an understanding that the
Chinese government does not permit an Agency to have cooperation
agreements with more than two U.S. attorneys.iii The folks you meet at the
Ministry of Public Security may be able to help save you time and effort by
directing you only to Agencies that do not already have two agreements
executed.
Finally, with respect to their marketing capabilities, try to ascertain what they
know. Isn’t that a point of an interview process? Do they understand how to
market EB-5? How do they market it? What does the marketing arm of their
Agency look like? How do they make themselves stand apart from the crowd in
their approach to potential investors? What makes their marketing unique and
credible? Would you buy a car from this Agency based on their marketing? What
is their definitive marketing plan? What is their value system, vision, and mission,
and how do they demonstrate each successfully to potential clients?