To Innovate or Start-up? The great Visa conundrum…
Do you know the key differences between Start Up and Innovator Visas? Which would be the most appropriate for you?
You’ve got a great idea for a business which you want to run from the UK. You may currently be overseas, or you may have just graduated from a UK University. Either way, you need a visa and endorsement, but should you go for the Start-Up Visa or jump straight in for an Innovator Visa? Hopefully, this will help you make your mind up.
When we began issuing our clients with Endorsements, we only supported Innovator Visa applications. However, we soon saw a rise in the number of great business ideas coming through our programmes, who need endorsement but aren’t quite ready to fully commit to their own venture due to any number of risk factors.
As someone once said of the finest plan “until it works, there are still a million things that can go wrong”.
Bearing this in mind we’ve added our Innovator International – Startup+ programme which is aimed at helping early stage businesses at a lower cost. To find more about the costs associated with our support programmes please contact us directly.
So what are the differences in the various types of Visa, and which route is best for you?
Criteria for Innovator and Start-up Visas
Every business venture has to be viable, innovative and scalable. We know pretty quickly from seeing your plan if your business is viable. However, it’s the innovation and scalability which raises the most debate. We’ve lived and breathed Innovation for a few decades now, so we reckon we know what we’re talking about.
To keep it simple, for the context of this scheme, we define innovation as “bringing benefit to someone in a manner which is not commonplace in the UK”.
Remember, “someone” may be a client, staff member, supplier or anyone else, so we’re not just looking at innovation in the context of science & technology. We’re looking at the wider context, including business model innovation too.
We’ve written a blog on this too – for more information, please click here:
In a nutshell, there are 3 types of Innovator Visa:
- New business (pretty much what it says…)
- Same business as previous endorsement (effectively an extension visa)
- Settlement in the UK (a formal request for Indefinite Leave to Remain)
For most applicants the ultimate target is the final category – Settlement. However, you have to be in the country for 3 years before you can apply for this Visa. Bearing this in mind, the entry point for most people will be the Innovator – New Business Visa.
The key points about this visa include:
- You need to provide evidence of at least £50k (per applicant) to invest, or currently invested in the business venture
- You must work entirely on your business venture and may not have any other form of employment outside your business.
- You are granted “leave” for 3 years at a time, and may bring family members to the UK
After the 3 years have passed, you may apply for the extension or settlement. The conditions for settlement are strict and rigorous – if you have not achieved these within your first 3 years of trading, you might want to apply for the extension visa to give you a little more time to reach a point where you meet the criteria.
So, if you’re focused with a good business plan, you can reach a point where you can apply for settlement in 3 years – but you have to have a minimum of £50k to invest in your business to get it up and running as quickly, effectively and efficiently as possible.
Let’s assume that you’re not a seasoned business person – at least as far as operating from the UK is concerned – and your business carries more risks. It may be that you’re pretty sure it will work, but need to test the water a little. It may be that you want the security of a paid job to fall back upon if things don’t quite go to plan or you need some development time. It may even be that you don’t have the £50k to invest in the Innovator Visa and want to build funds through your venture.
This is where a Start-up Visa may be for you.
The key points about this visa include:
- You are starting a business in the UK for the first time (you may have started setting up the business but must not have commenced trading unless you were previously granted leave under the Start up or Tier 1 Graduate Entrepreneur category or the Tier 4 doctorate extension scheme)
- You must spend the majority of your time developing your businesses but can also take on other work outside of their businesses, to support yourself.
- You are granted “leave” for 2 years at a time, and may bring family members to the UK
At the end of 2 years (or as soon as you can demonstrate significant progress and 12 months sustainability), you can switch into the Innovator category to extend your stay and develop your businesses in the UK. You can apply straight for the “Innovator – Same business as previous endorsement” which effectively bypasses the need to invest £50k into your venture. However, you do need to demonstrate “significant achievement” for your application to be endorsed.
The key point you need to consider is that the 2 years on your Start-up visa do NOT count towards the 3 years required to apply for settlement. These 3 years only count if you’re on an Innovator visa. So, with your 2 years on Start-up plus 3 years on Innovator (same business as previous endorsement) it’s going to be a minimum of 5 years before you can apply for settlement.
In a nutshell:
If you’re confident your business will work, you have at least £50k to invest, you want to apply for settlement as soon as possible and you’re not going to need additional income to live (other than your investment and revenue from your venture) then the Innovator Visa may be best for you.
Alternatively, if your business carries more risks, you need a little time to make sure it’s all going to work, you don’t have the £50k to invest or you may need an additional income beyond the venture – and you’re happy to wait at least 5 years before a chance to apply for settlement – then the Start-up Visa would probably be better for you.