A Guide to the UK Start-up Visa

In my previous blog post, I broke down the ‘General Requirements’ for coming to the UK or switching inside the UK to the Start-up visa or Innovator visa.

In this post, I will outline the ‘Specific Requirements’ for Start-ups, focusing on the new endorsement criteria.

Who is the Start-up visa for?

According to the Rules, “This category is for people seeking to establish a business in the UK for the first time.”

In contrast to the Innovator visa, it is not for more experienced business persons. Those switching to the Start-up category in the UK will be Tier 1 (Graduate Entrepreneur) Migrants, who will be recent graduates, Tier 2 Migrants, Tier 4 (General) Students and Visitors who are here as prospective entrepreneurs.

Can you join an existing business or must you start a new business?

The answer may turn on whether ‘establish’ in Appendix W has the same meaning as it does in Part 6A. The Tier 1 (Entrepreneur) route was intended for migrants who wished to establish, join or take over one or more businesses in the UK, suggesting that each of these actions was distinct. The Tier 1 (Graduate Entrepreneur) route was intended for graduates who wished to establish one or more businesses in the UK; at the endorsement stage they only needed to have a genuine and credible business idea.  The Start-up route is explicitly said to be a replacement for the Tier 1 (Graduate Entrepreneur). All of this leads me to think that the reference to ‘establish’ only was purposive.  

The only thing which may indicate that joining or taking over a business is a possibility, is a throwaway sentence at the new 245D(a)(iii): ‘Other migrants who wish to establish, join or take over one or more businesses in the UK may apply under the rules for the Start-up or Innovator categories, which are set out in Appendix W.’   Hopefully, clarifying Guidance will be issued by the Home Office on Appendix W or the Rules themselves may be tidied up to remove such apparent contradictions.

Can I apply for a Start-up visa as part of a team?

Yes. You do not have to be the sole founder of the business. You may instead apply as part of an entrepreneurial team.

Do I need to have investment funds to apply for a Start-up visa?

There is no specific requirement to have investment funds. As before with Tier 1 (Graduate Entrepreneur) Migrants switching to Tier 1 (Entrepreneur), if you can show £50,000 of available investment funds for your business you can switch from Start-up to Innovator. However, you do not need any funds other than the £945 as maintenance to enter the Start-up category.

What are the criteria for a Start-up endorsement?

First, you must have an innovative, viable and scalable business idea which is supported by an endorsing body. Let’s break that down:

• Innovation: you must have a genuine, original business plan that meets new or existing market needs and/or creates a competitive advantage
• Viability: you must have, or are, developing the necessary skills, knowledge, experience and market awareness to successfully run the business
• Scalability: you must show evidence of structured planning and potential for job creation and growth into national markets

How do these requirements compare to the Innovator route?

Well, the broad headings are the same but Innovators cannot be developing the knowledge, skills, experience and market awareness, they must already possess them. As for an Innovator’s scalability, the potential job creation and growth must be not only in the domestic market, but also internationally.

There are very specific evidential requirements in the Rules for the endorsement letter that must be issued by the endorsing body and which forms part of your application.

Second, you must reasonably satisfy the endorsing body that you will spend the majority of your working time in the UK on developing business ventures. This can be distinguished from Innovators who have to spend their entire working time in the UK on such development.

Who can endorse my Start-up visa application?

We have prepared an up-to-date list of approved endorsing bodies for Start-up visa applications. 

Endorsing bodies must be either:

• a UK higher education institution, that is in receipt of public funding (from the Higher Education Funding Council for England, the Scottish Funding Council, the Higher Education Funding Council for Wales or the Department of Employment and Learning in Northern Ireland). It must have an established process for identifying, nurturing and developing entrepreneurs among its undergraduate and postgraduate population.

OR

• an organisation that has a proven track record of supporting UK entrepreneurs (including resident workers) or is a new organisation set up for this by another body that has such a track record. Additionally, the request to become an endorsing body must be supported by a UK or devolved government department and be linked to the department’s policy objectives.

The organisation must be able to competently assess Start-up business ventures against the endorsement criteria. The endorsing bodies, like Tier 2, 4 and 5 Sponsors, now have compliance responsibilities regarding contact at endorsed checkpoints and monitoring of the development of migrants’ business ventures. They must not be connected to past or present abuse of the immigration system.

Will the Start-up visa lead to settlement in the UK?

No, at least not directly.  This category offers leave for a maximum of 2 years. For Tier 1 (Graduate Entrepreneur) Migrants your total time in both that and the Start-up category can also only be two years.

Like the Tier 1 (Graduate Entrepreneur) category, the Start-up does not lead directly to settlement in the UK, but you may progress into the Innovator category (which can lead to settlement) or perhaps use it as part of your 10-year qualifying period for long residence.

Concluding thoughts regarding the Start-up visa category

On the whole, the Start-up category seems to be a good replacement for the Tier 1 (Graduate Entrepreneur) route as it is open to a larger audience of people who may not be recent graduates but who may have a credible business idea. However, it does seem to place all of the cards in the endorsing bodies’ hands, which are ultimately in the Government’s palm as these bodies will either be subject to public funding or supported by a government department.  

It is likely that there will be a two-stage application process. In stage one, you will need to identify an appropriate endorsing body (or multiple) and make applications to it. There may be a fee and separate requirements for each endorsing body at this stage. However, once an endorsement is obtained, this is not the end of the matter. Stage two will be the application to the Home Office: even after having satisfied your endorsing body with your business idea, you must still satisfy the Home Office of your credibility.

With the uncertainty surrounding these new categories, and the rigidity of the requirements in its predecessor categories,  it will be important to properly analyse the new requirements to determine your eligibility and ensure that your documents meet the black letter of the Rules.

Contact our Start-up Visa Immigration Barristers

For expert advice in relation to an application under the Innovator or Start-up categories, contact our Immigration Barristers in London on 0203 617 9173 or complete our enquiry form below.