EB5 Investors Magazine: Can you please tell us about your company and what makes it unique from other migration agencies?
Anna: I am one of the founders of WIL Overseas Capital Investment Company Limited (WIL). We established the company in 1997. The company was one of the first to receive an exit and entry license in the Canton (Guangdong) province. Currently, Canton no longer has regulations requiring this license. In 2003, we started our practice in the immigration business, so we now have 13 years of experience in the migration industry. For the past eight years, the Shenzhen General Chamber of Commerce has ranked WIL at the vice president level, and our company was the first of its kind to be awarded as an “Established Brand” in 2015. We are one of the first migration companies to be nominated and granted such an award. The company provides services much like a family office, and the investment immigration program is a key component. We are aiming at high-net-worth clients and high-high-net-worth clients. So we want to act as a consultancy to clients in terms of any family affairs relating to overseas business— especially for education, which is a key component. The way we handle education involves planning in the initial phase and a review of the child’s progress. Also, we provide tutoring services for the family and gradually lead them to an appreciation of Western values and culture—both on the academic side and social side. As far as children’s education, we’ve received a lot of positive feedback from our clients. They feel like there is a very valuable component to that service. But we are not doing the overseas’ advisory service as an individual component—it’s not a regular kind of service. Rather, for our high-net-worth clients, it’s part of that service.
Apart from the education sector, our focus is on wealth management and objectives regarding asset allocation overseas. If they’re EB-5 clients, do they have any settlement plans, do they want to have a comprehensive retirement plan, a child’s education plan, etc.? Also, what is their tolerance in terms of investment? After that, we refer our partners in the United States to fulfill our services to them. At the same time, we monitor the satisfaction of the clients and how they feel about it. There’s a cultural element here. Also, we have private equity investment projects with our partners, so if they have more aggressive investment needs, we will work with our partners as well. The other sector involves taxes. We have licensed tax advisors to help our clients understand their taxes, and when they make investments, what is the link with those taxation issues.
For most companies, it takes a long time to build up these resources and know-how, so we are very proud that we are very comprehensive in this sector with our services—to help one particular client really understand his or her needs and then to provide the services that can satisfy such needs.
EB5 Investors Magazine: Can you share a little bit about why you decided to enter into this business?
Anna: I decided to go into this business because of my educational background, and also because I want
to offer the things we are interested in understanding better, and then share that knowledge with people who have such needs. We regard this as a very valuable thing that is a part of our business. Also, I personally wanted to create a person-to-person business, to build up connections, and also to listen to the needs and try to understand such needs. I feel very satisfied with such work.
EB5 Investors Magazine: What countries do you help immigrants migrate to on the investment immigration side of your company, and what are the most popular immigration programs that you offer?
Anna: We used to handle the Australian and Canadian immigration or entrepreneur programs, but in the last six years, we’ve focused a lot on the U.S. EB-5 program. Apart from those, we also deal with high-net-worth clients to help with passport programs to the Caribbean countries. That is not a big portion of our business, but there is a growing market trend.
EB5 Investors Magazine: What are the most popular of those programs that you’ve offered?
Anna: The biggest is absolutely EB-5.
EB5 Investors Magazine: What do you see as the biggest issues facing migration agencies today?
Anna: The biggest issue is the market because in Canton there is no regulation; there is no license for operating such a business. The market has over 3,000 agents. It seems like it’s much more competitive, but actually it’s a challenge for the agencies on how to comprehensively and professionally answer such needs.
EB5 Investors Magazine: What do you see as the biggest obstacles facing the EB-5 program in particular? What should be done to address these issues?
Anna: If we’re looking at the business-side—the quotas—I think the waiting time is a bit too long. But to make this industry healthier, we need to really focus on a review taking a look at the impact of those failures and cheating in the market. I would say we need stricter regulations and reviews on a regular basis, and policy-makers need to make everything clearer and easier to evaluate. I think these are the biggest obstacles.
EB5 Investors Magazine: For your clients, what are their major concerns, both generally and specifically regarding EB-5?
Anna: I think it is the concern of risk. We have a good record and a lot of successful cases. However, the market offers a variety of different programs, and the clients don’t have the knowledge to identify the risks. They have the risk, but don’t know how to manage it. That’s why this is such a big portion of our business now. They still just rely on friends’ referrals—previous successful cases. Getting the money out of China is another obstacle today for investors.
EB5 Investors Magazine: What are the biggest obstacles for the expansion of EB-5 in China? We hear a lot about competition, government regulation, etc. What are your thoughts?
Anna: The market is already oversupplied, so I don’t think it’s a great idea to provide more. But there are other trends for those people. They should consider wealth management-related products. Another obvious need in China is the degradation of the renminbi (RMB) so they want to get the money out of China. If you have products or services to satisfy that need, that would be great—so don’t focus too much on EB-5.
EB5 Investors Magazine: So, then an obstacle is the risk and then getting money out of China. And for investment immigration, what kinds of projects do you generally look for—usually within EB-5, or more generally?
Anna: I focus a lot on a triangle structure. That means there is a project side, and then there is a fund manager side, which is like a regional center (the private equity fund manager), and also the investors. I find this structure is more stable and reliable. This is the first thing I look at. I try to avoid selecting projects where the regional center is highly related to the project. I look at the regional centers or the fund manager’s previous experience, their track record, and also their functions on that particular project, and also their business assets.
EB5 Investors Magazine: Does your company offer both the regional center option and the direct investment option?
Anna: We just focus on regional centers. I’ve found this is more stable. If people are looking at the principal phase and the green card, and they don’t have such business experience, or they don’t have knowledge of that, the chances of failure are huge.
EB5 Investors Magazine: Where in the capital stack do you feel most comfortable?
Anna: I would prefer the form of a loan. I’ve found some projects put the investors as preferred shareholders—they have all the high risk of being a shareholder, but their return does not match the risk. With the loan as collateral, they have more security for the funds. Their aim is very clear: their primary concern is that the principal is safe, and also the green card. I would always advise clients to focus on that. To balance a project—for the green card, the safe principal, as well as the return—sometimes I suggest for them to separate the immigration program from the other PE investment projects, because different PE’s have different aims, and to make it more effective to reach the goal in the end it’s a better idea to keep them separate.
EB5 Investors Magazine: Is there a specific percentage range that your company looks for when they put their EB-5 investors in a project? The average now is 30 percent; do you have a preference when you’re looking at a project?
Anna: I think that 25 percent is good and 30 percent is the maximum. I don’t feel comfortable if it’s more than that. I always welcome it if they put in more equity funding. For the collateral, if they have the same kind of collateral with the bank, that’s very good. Also, we look at whether they have different collateral assets as even better. So, separate the collateral from the bank, and also see if the collateral is liquid, and that the value is the fair market value, and if it’s over 150 percent of the money they borrow, I feel comfortable with that.
EB5 Investors Magazine: Do you have a separate underwriting department that analyzes the deals?
Anna: We don’t have a special underwriting department, but we do have a due diligence process. We will pay for a third party to study particular things that we don’t understand very well—to study that area and give feedback reports. When you’re talking about underwriting, that’s also one of the reasons why I choose to have the regional center or the PE fund separate from the project itself. The reason why we choose to have such partners is that they are very experienced with the immigration centers. They know what they’re aiming for with their projects. The second reason is that they’re better able to control the financial risks— this is their primary task. And then I choose those partners who have a good track record, good business assets experience, and especially if we have dealt with them for a couple of years and understand how they react in negative cases and how they perform. From there we build trust. To that end, that’s why we don’t have our own underwriting firm and why we work with those partners. But we do, in particular areas, have a due diligence process.
EB5 Investors Magazine: What’s the estimated volume of EB-5 that you do per year?
Anna: Not much really. We have around 50 projects. That’s the average. But this year we did a bit better—maybe a 20 percent increase.
EB5 Investors Magazine: Do you have the capacity to take on more projects now?
Anna: We have reliable partners we’ve been working with and who we feel very comfortable with, so of course we will place their considerations first, and we feel very comfortable with that. But I want to have more partners from the wealth management side rather than the EB-5 side.
EB5 Investors Magazine: What are your plans for expansion of your company?
Anna: I don’t think we have ambitions to expand throughout China. That’s our strategy. We’re focused in Shenzhen. We’ve been here 19 years and we have a good market reputation. The market has more extensive needs, so we need to provide very professional, comprehensive services to satisfy the market better. This is our strategy, rather than expansion of other branch offices around China.
EB5 Investors Magazine: On the overseas side, how do you handle relocation services? Is that outsourced or do you have an affiliated company in the destination country for your clients?
Anna: When we talk about relocation, that’s not only housing and the daily counseling, but also for wealth management to satisfy their needs. People can’t evaluate housing by themselves. For that reason, I refer them to a housing agent or insurance agent because they can get the business from them, but we select the agents we’re working with to make sure that they meet our standards. We outsource, but we focus a lot on the selection of partners for wealth management.