Key factors you should plan for when applying for Indefinite Leave to Remain (ILR) on the Innovator Founder visa

Today, we’ll discuss the key factors you should plan for when applying for Indefinite Leave to Remain (ILR) on the Innovator Founder visa.

The first thing you need to consider is the actual process of operating your business.

Endorsement Letter for ILR Application

To apply for Indefinite Leave to Remain on the Innovator Founder visa, you’ll need to obtain another Endorsement Letter from your endorsing body. This is a crucial step, and your planning should be centered around ensuring you meet the requirements for this endorsement.

Key Considerations

There are several key aspects you need to plan for when seeking ILR:

1. Progress Against Business Plan
2. The endorsing body must confirm that the applicant has made significant progress against the business plan assessed during the previous endorsement. This means the business plan you submitted when applying for the visa will be reviewed, and you need to demonstrate that you have made progress in executing that plan.
3. Company Status
4. Your company must be registered, and you must still be a director or a member of the business. Additionally, the business must be active and trading in the eyes of the Home Office.
5. Active and Trading means that your business generates revenue, not just doing research and development. It should be selling products or services and should not have plans to close.
6. Sustainability for the Next 12 Months
7. Your business must appear sustainable for at least the next 12 months. This is assessed based on your assets, expected income, and planned expenses. In other words, your finances should be stable, and the business should not appear to be on the verge of closing.
8. Active Role in Business Management
9. The applicant must demonstrate an active role in the day-to-day management and development of the business. This means each co-founder on the Innovator Founder visa will likely need to undergo an interview, and the endorsing body will need to confirm that they are indeed taking an active part in running the business.

Additional Planning: Meeting Two of Seven Criteria

Here’s where more planning is required: you need to meet two out of seven criteria.

1. Investment Criteria
2. The most common and straightforward criterion is to show that at least £50,000 has been invested and spent in the business. Just to clarify, each applicant must meet these requirements individually. So, if you have two applicants, you will need to show that £100,000 has been invested and spent during the visa period.
3. Customer Growth
4. Another criterion is that the number of business customers has at least doubled within the last three years. Additionally, this number must be higher than the average for similar businesses.
5. While the first part of this requirement is relatively easy to demonstrate, the second part—proving your customer base is larger than that of comparable businesses—can be challenging. This requires rapid growth, so we don’t often see applicants relying on this criterion.
6. Research and Intellectual Property (IP)
7. If your business has been involved in research activities and has applied for intellectual property protection in the UK, this can be another valid criterion.

Other Criteria to Consider:

• Made £1 million in revenue in the last full year covered by your accounts.
• Made £500,000 in revenue in the last full year, with £100,000 of this coming from exporting overseas.
• Created the equivalent of 10 full-time jobs that have existed for at least 12 months.
• Created the equivalent of 5 full-time jobs that have existed for at least 12 months, with an average salary of £25,000 a year.

The job creation criteria, especially the second one, are more within your control, unlike revenue-based criteria.

Which Criteria to Focus On

For most businesses, the most effective approach is to focus on the £50,000 invested and spent in the business, along with the intellectual property protection criteria. However, if you are approaching the end of your second year and haven't yet made progress on intellectual property, you might consider focusing on the job creation criteria, which can be more within your control.

Plan Ahead

It’s essential to plan in advance. If most of your activity takes place in the third year, there’s a high chance the Home Office might view your business as not genuine. We’ve seen this happen with some candidates in the past.

So, be careful and make sure that you are actually operating and developing your business throughout the duration of the visa.