This interview has been conducted between BLS Magazine and Robert W. Kraft, President of Invest in the USA (IIUSA).
Mr. Kraft is the Chairman, President, and Chief Executive Officer of FirstPathway Partners (FPP), a firm that invests money on behalf of foreign nationals seeking US permanent resident status and ultimately citizenship under the US EB-5 Regional Center program.
An active member of IIUSA since 2007, Mr. Kraft has served on the boards of DCI Marketing Inc, United Community Center, Metropolitan Milwaukee Association of Commerce (MMAC) World Trade Association (WTA), and is co-Chair of the China Council, hosting many delegations of high-ranking Chinese officials. He also served on the boards of RBP Chemical Corp., the Point of Purchase Advertising Institute, the Council of Small Business Executives (MMAC), Word of Hope Ministries, University of Wisconsin China Leadership Board, and Open First LLC.
He is a staple in the citizenship by investment program community and we are glad to have him here today.
- Now as President of IIUSA, how would you say your previous positions have prepared you for such an importance role?
Since getting my Bachelor’s from John Carroll University in Business Administration, I immediately began my career as a consultant at Moore Corp., Menasha Corporation, Citicorp Inc., and Deluxe Corp. before becoming President of DCI Marketing, Inc. and then Founder of Electronic Printing Systems in 1994. Throughout this time, I gained exposure to the importance of facilitating foreign capital flows and contracts with foreign clients to advance a variety of industrial businesses in addition to fueling economic growth. Leveraging this with my foreign contacts, I then ventured into the Regional Center business, a crucial part of many EB-5 projects, that has taught me incredible amounts about the myriad of requirements, the structures, and the nature of these investments, starting with PSA North America, then FirstPathway Partners in 2008. Here, we were able to hone in on the entrepreneurial spirits of both our foreign investors and our domestic partners, fostering relationships with many local government offices and officials, who were now able to see the potential in such economic growth. I had also served on the board of the Metropolitan Milwaukee Association of Commerce in addition to the World Trade Association, making the transition from board member to President of IIUSA a much more seamless move than most would anticipate.
- Throughout your career in international business, what do you think have been some of your most valuable experiences in forging connections?
Well, one experience I can specifically distinguish, after traveling to Asia in 2004, I realized that there is a great opportunity to acquire growth through in-person presentations and forums. Furthermore, I learned that these connections could be enhanced by also exposing members of the local government who hope to expand economic growth to these communities. Thus, after sourcing products and services from the region for years, in 2009 and 2011, I accompanied Wisconsin Governor Jim Doyle to trade missions to Shanghai and Beijing and then Governor Scott Walker in 2013. Since I had already moderated the Annual Wisconsin International Trade Conference China Session over that period, I knew I could bring more business and capital into the US through the EB-5 program. Having spoken in all of the major cities in China, I have made the contacts that could drive expansion in the US and secure the capital for projects in need of liquidity. Now with IIUSA, I can use my knowledge of the minutia of the process to understand the stakeholder perspective as well as advocate for practical improvements to the EB-5 process.
For our readers that may not be familiar with IIUSA, what is it and what does it do?
Invest in the USA (IIUSA) is a not-for-profit, industry trade association dedicated to issues relating to the EB-5 Regional Center Program. More specifically, we are an advocacy group serving as an intermediary between EB-5 stakeholders and legislators. We seek to not only promote the program and its activities, but also, to advance and maintain Regional Center industry standards, educate the public and government through research and reports about the immense benefits that the EB-5 program provides, and serve as an ombudsman between regional centers and various government agencies. Our members are major industry leaders and players across all facets of the program, from regional centers to law firms to financial service providers and consultants. In a nutshell, we are essentially the Chamber of Commerce for EB-5.
As newly elected President of IIUSA, what will you bring to the table and what do you hope to achieve during your tenure?
As someone who has actively participated in the EB-5 program for over a decade and has more than 40 years of international business experience, I hope to leverage my expertise in bridging global perspectives to better represent the voices of foreign stakeholders. Having made numerous trips to Asia and hosted multiple high-level delegations from China, by far the largest source of EB-5 investment, in my home state of Wisconsin, I have witnessed firsthand what the needs of international investors are as well as the economic growth and job creation that they can bring. Over the course of my tenure, I hope to not only continue the amazing work that IIUSA has done for EB-5, but also, raise the profile of EB-5 in some of the program’s growing markets – particularly in the Middle East and Latin America.
You mentioned the Middle East as a growing EB-5 investor market. What are some of the trends you are seeing from that region?
If you read our 2016 Investor Market Report, you can see that the Middle East has only represented about 2% of total I-526 approval “market share” between FY1992 and FY2014. However, a closer look reveals that since FY2011, the Middle East has represented a greater share – over 10% of all I-526 approvals. Within the region, Egypt and Iran represent by far the largest markets, accounting for more than 75% of all EB-5 investors from the Middle East. While those two markets will continue to dominate, we are also seeing a burgeoning market in the United Arab Emirates: 100% of all I-526 approvals from this country have occurred since FY2008. It appears that the UAE and the greater Middle East will continue to experience fairly robust growth for EB-5 in the near future.
Do you foresee any impact resulting from changes to the program currently being debated by lawmakers?
We will have to wait and see what the final changes to the program look like. What definitely seems to be on the table though is an increase in the minimum investment amount. I expect that this will dampen the demand for visas to some degree, depending on what the final agreed upon amount is. I also expect that there will be greater scrutiny and regulation on regional centers, qualifying projects and investors. This will most likely have an effect on the number of approvals and projects, but will ultimately serve to foster a more vigorous and robust EB-5 marketplace.