Thursday, July 28, 2016
The outcome of the Brexit vote, and the forces unleased by it, may give some non-EEA entrepreneurs pause for thought when considering the most beneficial, supportive and welcoming base from which to launch their enterprise. For many who have turned their gaze to Ireland, they still find a land of a thousand welcomes and one which is particularly supportive of innovation and foreign investment. Regardless of the political chaos thrown up by the referendum in the UK, Ireland remains a committed, outward-looking EU member. Over here, it’s business as usual.
Ireland remains one of the most open economies in the world and is consistently ranked as one of the best countries in the world to do business in. With a growth rate of 26.3% in 2015, it has the fastest growing economy in the European Union. It has a young, English-speaking and highly educated workforce and, with about one in six Irish residents of international origin, it’s little surprise that so many companies have set up their multilingual support teams in Dublin. So, if you are an entrepreneur who is not a citizen of the European Economic Area, how is it to relocate your business to Ireland?
The STEP programme is an innovative and relatively straightforward way for small business owners in the start-up space to gain the right to live in Ireland and establish their business. There are two key requirements: the first is that you have secured funding of at least €50,000 for the proposed start-up – this might be in the form of self-funding, a business loan or investment from a business angel or Venture Capital funding (VC). The second requirement is that your business can be considered a High Potential Start-up (HPSU).
An HPSU is a company which is:
All STEP applications are assessed by an Evaluation Committee and cost €350 per application. It is important for the Evaluation Committee that any prospective company must demonstrate a genuinely innovative idea that is capable not only of creating jobs in Ireland, but also of having significant potential for generating exports – particularly in the case of companies engaged in manufacturing, hi-tech, design or internationally traded services. As such, companies that operate in the purely domestic market (such as retail or hospitality) will not be accepted as part of STEP, though entrepreneurs engaged in these areas might be able to avail of other immigration options.
STEP applicants whose proposals are approved by the Evaluation Committee, who evidence their funding and are of good character will be eligible for a full residency and work visa (Stamp 4 residency permission) – for themselves, their spouse/partner and their minor children – lasting for two years. This residency permission may be renewed for a further three years, provided that the start-up remains in business and the Evaluation Committee is satisfied of its future viability. Thereafter, permission may be renewed every five years.
Of the sources of funding available to start-up entrepreneurs, Enterprise Ireland is perhaps the most important. As the Irish State agency responsible for funding and supporting companies of all sizes, it funds dozens of small and mid-sized companies annually. Start-ups with the potential to create 10 jobs and €1m in sales within 3 to 4 years of starting up are eligible for the Competitive Start Fund (CSF), which makes investments of up to €50k per company. In 2015 alone, over 110 start-ups were funded by Enterprise Ireland’s CSF. Reflecting on the very similar criteria for the STEP Application and CSF (and noting that Enterprise Ireland participate in the Evaluations Committee for STEP), an innovative business pitch accepted for CSF can consider itself in a strong position to proceed with an application for STEP.
Of particular interest to foreign business owners is the dedicated CSF for international entrepreneurs, aimed at start-ups that are currently based overseas but are willing to relocate to Ireland. The competition offers a €50k investment for a 10% equity stake in the start-up and successful applicants from outside the EU will then be eligible to apply for a STEP visa for themselves and their families. The next CSF of this type opens on Wednesday 24th August 2016 and will close at 3pm on Wednesday 7th September 2016. Applications are made by way of an online application form and a video pitch. Selected applicants will then be invited to travel to Ireland to make a short investment pitch to the judges (Enterprise Ireland will cover travel and accommodation costs). Of these, up to 10 companies will be awarded CSF funding by Enterprise Ireland.
In recent years, Dublin has seen an explosion in tech incubators, accelerators and mentorship schemes designed to transform good ideas and promising talents into thriving start-ups and successful entrepreneurs. Under the scheme, non-EEA citizens taking part in such initiatives may be eligible for a 12 month immigration permission, which will allow them to participate in the incubator and prepare and submit a STEP application. This visa is particularly useful for those who have yet to secure adequate funding for a full STEP application. Once in Ireland, non-EEA entrepreneurs will be able to apply for funding from a wealth of Irish state agencies and local VCs.
The next deadline for receipt of applications for STEP is the 14 September 2016. To get an application over the line, the biggest hurdle is being satisfied you have a genuinely innovative business proposal which would constitute a HPSU and you have minimum funding of €50,000 available to invest in that proposal.
Once you have ticked those boxes, time and organisation are of the essence – firstly to ensure you prepare a business plan which corresponds to the requirements of the Irish Naturalisation and Immigration Service, and secondly, to collate the various documentation, references and security checks necessary to secure residency permission. If you already reside in Ireland, you also need to bear in mind your current immigration status – it is vitally important that you ensure your permission to be in the State remains valid at all times. In certain cases, this may necessitate applying to the authorities for an interim extension to your current immigration permission pending notice of the outcome of your STEP application.
With the next deadlines for both STEP and CSF funding fast approaching, now is a good time for any emerging start-up to put in a place a comprehensive plan to best unleash the potential of the business. Between STEP and CSF, the potential is there to meet two of the primary needs of any HPSU – a home for both the business and the brains behind it and funds to keep it fed.