Why Foreign Investors are The Best Scaling Stragegy You Aren't Using

Welcome to Ali and you'd the Business Success and Lifestyle show. I am Alyson Maslin. My friends call me Allie. And today, you business owners, you do not want to miss this episode. I am so excited because have you ever thought of possibly for your business growth working with investors outside of the U.S. or maybe you're residing outside of the U.S. and you want to do business and the U.S. do you have a business that you want to scale? We have the answers today right now right here on Ally and you. So I'm excited. I'm going to just dive right in because we have the most amazing expert today that is going to give you all of those answers. Before I start, have you checked out my brand new book, Scale or Fail? Talk about scaling. We recently launched it. It hit the Wall Street Journal bestseller list. Very excited because now that it's been out and people are reading the book, they are absolutely loving it. So, so if you haven't gotten your hands on it yet, go to scaleorfail.com because you can still get some amazing bonus gifts with that. So moving on to our awesome esteemed guest and a dear friend of mine, someone that I've had the honor and the blessing to work with for the last several years as well, Lauren Cohen. And Lauren is a number one best selling author. She is an inner international speaker. She is a recognized attorney and a skilled immigration and business law strategist. This is such a unique topic that you probably have not heard before. Her consulting company, eCouncil, simplifies the complex immigration process for both foreigners wishing to access US Markets and American businesses seeking alternative capital. Right. It's all about being creative. Sometimes you feel like you're stuck in your business, but you have no idea how much opportunity is out there for you. And we're going to open up that door today. She's also the creator of the revolutionary Scale up checkup, an online assessment service for business owners who are facing the daunting challenge of scaling. And I am talking to those business owners all the time. This is so incredible. You've never seen anything like it. Lauren's an active member of the American Immigration Lawyers association and she's been named as one of 2017's super lawyers. She is definitely a super lawyer, a super lady and I adore her. So. Hi, Lauren.

Hi, Alison. It's a mutual love fest here.

Well, I am so glad to finally get you on the show and what you have to what we're going to talk about today really opens the door to so many opportunities for business owners that had no idea that this was possible. But let's kind of back up a little bit and then we are going to get into the nitty gritty. You've got some tips, you've got some action items, you've got a whole unbelievable gift for helping business owners to scale. What inspired you to start working in immigration and business law?

First, and thank you so much for having me on the show. It's a pleasure to be here finally. I wish that I was physically there in so many ways, but I'm here in south Florida and I hope that everybody is safe with the fires and everything. First, I just wanted to say that I call you Allison. So I need to rethink that, I think, because I think I'm your friend at this point and I maybe need to stop switched to ally. So I have to think about that.

I think you're in the ally realm now. So please.

So it was kind of a long journey. I'm an immigrant. You wouldn't know it necessarily from looking at me, but I am from that country north of the border, Canada, as are some other members of our Pinnacle Global network. And as an immigrant myself, I went through so many hoops to get here. It was not easy. People think, oh, you're from Canada. It's so easy. It's like a no brainer. It's so not. It's not easy at all. You have to do all the same things as pretty much anybody else. There are a few exceptions to give you certain visas. But basically I decided after going through all those hoops and becoming a citizen in 2012 when my son was 2, that it was time for me to give back and figure out a way that it was like a duty, an obligation to help other business owners and other immigrants to find creative ways, like you said, creative ways to come into the country. And mainly through business investment. And the reason for that is my background was all about corporate law, business law, business plans, you know, business structure, business consulting. So it didn't really make sense for me to go into immigration unless it was business related. So people are always asking me, especially about now with all the stuff going on and immigration issues and the ban and everything. I don't have all those answers because I'm completely focused on business immigration. And so it was really kind of a. It was an obligation, as I say, I had to do it. And I was always seen as the deal making lawyer, not the deal breaking lawyer. I'm sure you know the difference. Having been in as many businesses as you have and being that deal making lawyer, finding solutions for the companies that were seeking to expand through creative ways and bringing foreign investors to those companies or the foreign investors from all over the world. I mean, there's really no country that I haven't dealt with a foreign investor from or helped them get into the country. So that's pretty much my opinion.

It almost seems mind boggling for most people to even think that, that there is money outside of the US that they are wanting to possibly invest in your company. If you're watching this right now, it's such a unique skill that you have. Obviously you're a great negotiator, you're a great mediator and a great researcher and just so brilliant. So how does immigration law help business owners?

So it's funny, there's a lot of immigration programs in this country that bring a lot of money and a lot of skilled labor and a lot of really highly skilled, like personal capital into the country. There's multiple different visa categories. And it really gives you as a business owner, let's say that you want to bring in fresh blood, for example, you want to bring in somewhere with a software background, a developer. I just went through working with developers. As you know, that's not really that fun. But let's say that you have an opportunity to both raise capital and bring a developer in. As a vested partner, you could win on both sides and have the opportunity to help a foreign investor come into the country. Kind of killing multiple birds with one stone. It's a way for a lot of franchises have huge opportunity. I love franchises because they're always looking for creative ways to expand and increase their unit numbers. And foreign investors are a great resource for that because they are, they're highly capitalized, they're highly skilled. They come to the country and they want that turnkey because they have to figure out so much when you come to this country, even from Canada. So it's just a win win on all sides. So I really think that a lot of business owners are overlooking and myself included, as I'm talking, I'm thinking to myself, wow, there's a lot of people that would be interested in my new business venture. So from overseas. And it's a reality that a lot of us don't think about on a day to day basis, but we should.

Well, you know, with our mentoring company that you're part of, Pinnacle Global Network as a client of ours and we help mentor business owners all over the world. I know that in the next few years we will be expanding to Europe. It's in our big picture vision. And I'm excited about that because, you know, there. It doesn't have to be a wall that divides the entrepreneurial community. There are people that are creative, there are innovators, that are change makers globally. Right.

I'm getting goosebumps as you're saying this. Like, I'm seriously, if you could see now, it's like, it's crazy because I know that part of your vision initially is to expand nationwide, and that's exciting as well. But expansion globally is a really big deal because you're right. We have to bridge the gaps, not create them. And there's enough stuff going on in this world, isn't there?

Yeah. So we have to all come together and hence the name Pinnacle Global Network. So that was always the plan. So now you specialize in something called EB5. And so can you tell me and everybody watching or listening right now why that's important, what it is and why it's important?

A lot of people know of EB5, but don't know that they know of EB5 because EB5 is always in the news. Unfortunately, it's usually in the news with negative connotations. So EB5 stands for employment based fifth preference category. It's a category. It's the only category of the immigration code that allows a person, an investor, to come in through an indirect, potentially an indirect investment without actually having to be employed by the business or having to make. Having to actually correlate their investment. And they don't have a nationality requirement, but they can come in and make a passive investment. Passive. That's the key. Potentially. Some are active, some are passive investment. In a business in the US Right now, the investment amounts are half million or a million, depending on the location. They have to create 10 new jobs directly or indirectly, depending on the type of investment. And they get a green card in exchange for this investment and job creation. It's much more complex than that. Obviously, I'm very much simplifying it, but it has. The EB5 program has raised billions of dollars and created millions of jobs all over the country and for that matter, all over the world and all of the like. I've done projects in Marianas Islands and Guam, which is, you know, way on the other side of the world. But they're US territories, so they count. So there's been a lot of negative stuff. A lot of unfortunately, where there's money, you know as well as I do, there's often fraud. There was recently a huge fraud case down here in south Florida for $99 million of Chinese investors suing the developer for misappropriating funds. And there's a lot of this stuff going on. So it's been, but it still has been such a boon for the economy despite, despite all of the backlash. You know, as I say, pretty much with anything where there's a lot of money, there's going to be unfortunately, fraud, because greed, it's like Gordon Gekko. Right. It's unfortunately a part of the business world. I wish it weren't, but it is.

Right. But you know, honestly, it's in everything. But if you can, you know, it's like where we put our attention grows. So if we can focus on the positivity of that and obviously seek to protect the other side of it, there's a tremendous amount of opportunity here.

Yes.

And for. There needs to be more opportunity here, and there's a lot of people seeking employment and that's just basically creating revenue is what they're doing. So, besides. So, well, actually, let's back up. What is the process? I don't want to go too much into this, but if somebody wanted to go that direction and what would be the process and what would they expect?

Well, if it's okay with you, I mean, the investor has multiple ways of investing, but if it's okay with you, since this is a business oriented focus show, I'd love to talk just real briefly about how it looks for the business to raise the money.

Yes, yes.

So let's say that Alison Maslin International wanted to raise 5 or 10, let's say $10 million to expand, build a facility and, you know, hire people and do all kinds of different things to really, really expand in a very significant way. So we would put together a project. There's multiple components. There's a business plan, a private place memorandum, it goes through securities lawyers, there's an immigration lawyer, there's a, there's an economic impact report to assess the number of jobs you'll create. And we figure out how much money you can raise based on how many jobs we expect you to create. So for every 10 jobs that correlates to one investor, which at the moment is a half million or a million. So let's say you wanted to raise $5 million. You would need to create at least. At least. Sorry, at least. I can't even think straight. But double. So for every half million. So in 5 million, you've got 10 units, 10 jobs, which is 100 jobs plus you need a job cushion of 20%. So 120 jobs would need to be created both directly and indirectly in order to raise that money. I actually created all these videos to explain this because it's just such a complex thing. But I'm telling you where you are in San Diego, where I am here in South Florida and all over the country, you've got hotels, you've got restaurants, you've got assisted living facilities. There's really not an industry, lots of casinos that's not touched by EB5 money, because it's a great way, was for a long time a very inexpensive way to raise capital. And probably one of the. Well, the government is basically helping you sell it. So it's kind of like, oh, we're condoning this. We're giving you a green card if you make the investment.

So my question is, once they invest, how do you work out the percentage of ownership of the company so they.

Don'T have to own percentage at all? This is the beauty of it and the unique piece of it.

Okay.

It depends on the type of investment. There's a direct investment and an indirect investment. 85% of the investors are indirect investors. So they, they actually loan money to an entity that loans money to the company. So they have no direct correlation or ownership of the company itself. Which is why so many companies love it because they don't have to ever really deal with those investors. They're really arm's length.

And then you pay back the loan.

With an answer after a certain number of years. Yeah, there's a five year pro forma that's included in your business plan, but then there's additional years that are added on depending on which country you're from and how long your process is to get your green, your conditional green card approved. And it's anywhere from seven to 10 years, which means that the money is stuck for that long. In theory, it's five years, but it takes at least two years for the process to occur.

Wow, this is fascinating. Lauren. I had no idea.

Yeah, it's an interesting area.

Yeah. Well, so now you have a really unique model in that you're of course doing this. All what we have talked about and worked with companies all over the world, and you're like an immigration concierge, you know, and because you had such a bad experience and you want to make it better for people going through this, can you share some stories, some of the clients that you've taken through the process and how the role, how your role has been pivotal for them?

Sure, I'll share one story. In particular, who's actually a local client. So they had been through the ringer. It was not an EB5 case. It was what's called an E2, which is a treaty investor, which means you have a treaty with the country, like Canada or most European countries, some South American countries, there's a treaty of trade and investment. And if you're from that country, you can make a substantial investment in a non marginal business. I know those are very complex terms which are not specifically defined. So a substantial investment could be 80,000 in one type of business or 300,000 in another type of business, depending on. On if it's service or product or whatever. So they made this investment and they had a lawyer and a business plan and everything, and they had been denied. So they came to me. I've known them for many, many years and we had lost touch and they came to me and said, can you fix this? So as a concierge, and I actually wrote an article called what in the world is an immigration concierge? So an immigration concierge is basically like a general contractor. I'm the back office, just like I am in Scala. I'm putting together all of the pieces so that you'll have a seamless process in place. So in this particular case, they came to me, they'd already had, or there was a denial pending, and I basically put all the right parties in place and got them approved within, I think it was six weeks of their original originally being challenged. So it was just a completely different experience because I was making sure that everybody was held accountable. And one of the problems, Alison, as you know, in running a business is that everybody goes piecemeal and they go, and they get, you know, they go here for their, for their computer and here for their lawyer and here for their accountant and here for their this and here for their marketing. And instead of putting it all under one roof and in the in E Council, I put it all under one roof so that I could make sure that all of the pieces were flowing and at the end of the day, consistent. We had another case where documents were filed. One document was $12 million differential. From another document, it was denied. We fixed it. Now those things can't happen because it puts the whole project, you know, at risk, really.

By not hiring you, they're potentially losing millions of dollars.

It really is true because it just.

Makes so much sense. This is why work with the coach. This is why, you know, like, I want straight to, you know, to get to the point the fastest way with the least Amount of headaches and to make sure that the deal actually happens. What are some of the biggest mistakes that you see business owners making? Now? We're going to. I want to switch gears a little bit, actually, so let me back up.

Well, this is actually going to switch gears.

Okay. Because, you know, Lauren, besides, on the immigration investor piece, you actually help protect business owners just, you know, everyday business owners as they really want to grow to make sure that their structures are protected and not like in a, you know, dire situation. But what are some of the big mistakes that could happen if they don't get these things in place? Sure.

So I kept seeing pervasive themes among entrepreneurs that were trying to grow and scale and make lots of money and cash flow issues. And what do I do to make money and not really looking after the farm, so to speak. When I speak, I talk about building your home, your dream home on a sinkhole. And that's really what they're doing because they're trying to make all this money and get to a million dollars in revenue. But if they haven't created that structure or put that legal foundation or the accounting or made sure they looked after their taxes or got the right insurance, created that strong foundation, they can't scale. They have no exit. They need a business plan. They need all of those kind of boring things that we call broccoli in my business, and they need to take all that broccoli and make it ice cream. So we have a fellow pin to thank for that analogy of turning broccoli into ice cream. That's what we're doing. Because without the broccoli, you can't have the ice cream. You have to have both or you don't have to have ice cream. But you really want it, so. I certainly do. So I think that the important thing is that in order to scale and not fail, like your book says, you really need to get that strong foundation in place and work with professionals that can help you to do that and make sure that you're. That you're cya ing yourself. You're looking after that groundwork. So as you're scaling, your business can scale along with you. You can't really franchise or expand or create multiple units without that structure in place as the foundation. Because you have to rely on your core, your core when you're doing at the gym. Right. It's all about your core. And without that core, you don't have it much to scale and you will fail.

Yeah, well, it is. You're absolutely right. It's like expanding with your house and adding on all kinds of extra rooms but you don't expand the foundation underneath and then the whole thing topples over.

Yeah.

You know, so and so because of this pain that you found, you created something totally revolutionary. And all around the topic that I love speaking about right now, which is scaling. And it's called, it's a new tool called scale up checkup. And so how did running ecouncil, this current business we've been talking about, lead up to creating this scale up checkup tool?

Well, they're so really similar in their kind of purpose or goal. The goal is to provide a one stop shop, a single point of contact solution for all of your needs. Now in the E Council setting it's mainly related to immigration and business. Immigration and investment. Immigration by investment. I took that and I kind of extrapolated and said I need to create a tool that gives lawyers and others, but lawyers especially because we have no recurring revenue, we've got nothing, you know, we're almost of us are only as good as our last deal or our last client, our last transaction. So I thought I need to create a tool that allows all of us professionals to access the same information to gather data and provide a score to entrepreneurs that assesses various levels from insurance to trademarks to legal to accounting, to like, you know, business succession planning, which I know you talked about last week and all of these components that are so important to helping a business scale. So this assessment, which is scaleupcheckup.com assessment, it's free and you get a very like a benchmark, empirically driven report that's delivered right to your email that says kind of, this is your score, you're exposed. Let's talk now. So what? Right? So what does that mean? It doesn't really do much if you get a score and there's no, there's nothing kind of no follow through. And again, this is a lot of where entrepreneurs break down because they have great ideas. And I'm guilty too. And you know, I've had many ideas. But the important thing is that this scored report leads into multiple levels from a professional resource strategic plan that we've just launched as of Friday, which is super cool, it's revolutionary as well to actually putting together a collaborative network of all the professionals that are needed to help you scale your business so you don't fail. So there, it's just every B2B service there's two levels. And it's really exciting because you come to us, they're certified, they're Vetted. They go through a certification process. Process. Look at that, My Canadian accent. They go through a certification process. And it's really important because otherwise you're kind of looking for resources on the web. You don't know what you're getting. You go to a lot of stuff which shall remain nameless, and you end up paying a lot of money for very bad advice, and you end up with egg on your face or you don't know what the heck it all means. And it's like going to seven doctors and getting seven meds that counteract each other and nobody is there to protect you. That's what we do. We are that back office again, that concierge that's overseeing the whole process and making sure that everybody's accountable and responsive and addresses your needs and that you're getting the right coverage at the right time for what you need to scale your business in a very structured, strategic way.

But the first place they start is getting the assessment. Because that even if you feel like, oh, my gosh, all this stuff is overwhelming, I don't have time. I'm super busy. Do the assessment because that will at least tell you, okay, to have a solid house, I need to have these things. I mean, do you have the right insurance? I've had clients who were sued of something that just were out of the blue. You would never think of anything. And because she actually had this umbrella policy which she didn't even know it ended up saving her company. There's just a lot of ins and outs. And so I think the first part, the first step, just do the assessment so you can at least see, all right, these are the holes that are missing. Maybe you don't need the whole thing. Maybe you need just two or three things. Maybe you need your contracts redone. Right. So. Or you're structure to your business. Maybe what you, you started with as one type of corporation, now that you're going to scale, you need to change that. In fact, Lauren, we're doing that in our company. We're changing that, that structure after several years.

So can I just throw one little thing in there?

Absolutely.

I was just talking with an accountant colleague of mine, and we're going to write an article because a lot of people, you may not, I mean, you know, but a lot of people may not know what an S Corp is, but there's a type of entity that's called an S Corp, and it's. There are certain qualifications and so on. If you've set up a limited liability company and you, you obtained a designation as an S corp and you haven't done certain things to honor that. Your S Corp election may actually be at risk and you may not even know it. And that's a really big deal because you may be operating as or thinking that you're operating as an S corp from a tax perspective, from a legal perspective, and you may not. So we're going to be writing an article about that very subject because entities change and needs change and we have to be respectful and cognizant that as the needs change, you have to change your business to match that.

Right. And the tax laws change a lot. So probably you set your business up. So I think sometimes, you know, we're so busy in business and we just get caught up with so many things that we're like, yeah, I'll deal with this later. I'll deal with this later. And then it sneaks up to bite you. So it's really important to do this. And I think it's just, it is revolutionary what you're doing, Lauren. And you know, and of course scaling is like my favorite topic these days. Now you have a gift for everyone and I was looking through this and wow, it's fantastic. It's called, let me just show it to you. It is seven secret scale up success strategies. Say that seven times.

Say it once.

I know. My gosh. And so we're going to give this gift to you just for being on the show today. You definitely want to do this because these seven secrets are unbelievable. So you really get to learn so many things about running your business that you did not know. And I'm actually going to be in fact, what you do, Lauren, here, you even outline all the difference between S Corp, C Corp, llc. I've actually never seen anybody doing that before. And you break it down with licenses, insurance. This is, this is amazing. So what you're going to do is go to allisonmaslin.com library and it's going to be right there. You're going to download it and it's a gift there. And so again, allisonmaslin.com library, you'll also get downloads from a lot of our other shows and gifts from our guests on Ally. And you'd now if somebody wants to reach out to you, Lauren, or learn more about ecouncil or scale up checkup, where do they go?

So first I would invite everybody as another free gift, please do the assessment. It is free and that could change someday because it's really cool and you will love it. Scaleupcheckup.com assessment. It's as easy as that. You can just go to scaleupcheckup.com and you'll see there's a link to the assessment. But if you assessment, you'll get to it. You can reach me, laurencaleupcheckup.com or you can call toll free, 866-724-0085. Or we're on Facebook and LinkedIn and Twitter and all those Instagram. I don't even know all of them. And you can always find us at EcoUnion Inc. Or scale Up Checkup. But I would love to connect with all of you and help you to scale your business successfully. You know, I really love to help entrepreneurs. It's kind of like a driving force. I can't even help myself sometimes. I say, okay, I'm gonna give you 15 minutes free. And then an hour later I'm like, oh, my gosh, I have to get off the phone. So it's kind of, you know, you're guilty of that too. Alison, we just can't. We can't help. We want to share our knowledge and our wisdom with others. And I'm so sorry about the sun. It's a little crazy here and I.

That's okay. That's all right. We've got you. And this was super informative and interesting in so many ways. Lauren, you are a breath of knowledge and I so appreciate you coming on Ally and you today and sharing all your wisdom with me.

It's been my absolute pleasure.

Yeah, this has been wonderful. So for those of you that are watching or listening, go to subscribetoali.com, subscribetoli.com and you can listen to us on audio when you're driving to work or you are running on the treadmill. And please get out and grab a copy ofscale or fail.com, grab a copy of Scale or Fail the book and go right to that website. Get yourself a book or several. It's a great gift for you as well. And like I say every week, get out there. Oh, you've got the book, Lauren.

A lot of copies. So if anybody wants to come here in South Florida, I'm happy to help you out.

And I'm excited I'm going to be seeing you in January for our Level up live event and can't wait. And if you want to check out our big event in January, go to levelupliveevent.com where we are going to have over 500 business owners from all over the world coming to build the blueprint. For 2019. So get out there and elevate yourself. And because you are worth it, Bye, everybody.

Scaling a business is not for the faint of heart. Playing it safe causes 34 million American business owners to avoid risk and entirely and suffer from smallness. I understand what you're feeling. No matter how hard you work, no matter what you sacrifice, you just can't seem to get to that elusive next level. That's because what got you here is not going to get you there. Scaling is not about working harder. It's not that one. Right, wrong strategy. It's the whole picture. It's you. It's your big, beautiful vision. It's your team, it's your drive. It's how you show up. It's time to take a leap off the trapeze so you can soar high in your business. But you're holding on too tightly and killing your growth. If you're truly ready to leap, it will not be easy. If you want easy, there's always your comfort zone. Are you prepared to fly? You're well beyond the startup phase in your company. You've created a decent level of success. Your tenacity, your spirit have gotten you here. But my gut tells me you were not put on this earth to play small and stay inside the box. There is something about the ability to direct your own fate. That drive for freedom, expression of creativity, building your legacy that pushes your entrepreneurial buttons. And that wild spirit. If you are fully ready to bust out, step into your power. Own it as the leader and visionary that you are. It's time to get your arms around the method that will finally get you there. You are not meant to be small. You are meant to shine. If you are truly all in, then let the adventure begin.

Ra.