How to satisfy the ‘success criteria’ for the innovator visa (UK)

If you are planning on applying for indefinite leave to remain at year 3 under the innovator visa (as opposed to simply extending for another 3 years), then you will need to meet two of the seven success criteria. This means that your endorsing body must confirm in their endorsement letter that you have achieved at least 2 of the following:

  1. at least £50,000 has been invested into the business and actively spent furthering the business plan assessed in the applicant’s previous endorsement
  2. the number of the business’s customers has at least doubled within the most recent 3 years and is currently higher than the mean number of customers for other UK businesses offering comparable main products or services
  3. the business has engaged in significant research and development activity and has applied for intellectual property protection in the UK
  4. the business has generated a minimum annual revenue of £1 million in the last full year covered by its accounts
  5. the business is generating a minimum annual revenue of £500,000 in the last full year covered by its accounts, with at least £100,000 from exporting overseas
  6. the business has created the equivalent of at least 10 full-time jobs for resident workers
  7. the business has created the equivalent of at least 5 full-time jobs for resident workers, which have an average salary of at least £25,000 a year (gross pay,excluding any expenses)

What is “significant research and development activity”?

I have emboldened the ones which are most likely to apply to you (and most innovator visa applicants). If you are going for the employment one (7) then the R&D one (3) becomes academic.  The most obvious example of a business that satisfies criterion (3) would be a business that does lab work on some kind of technology, which is then developed and there is an application for a patent to protect it. But in my view it would also in principle be acceptable to apply a conventional SaaS / software development cycle, such as:

  1. User research concerning an intended unique user interface for a platform;
  2. Development of a prototype user interface on the basis of the user research;
  3. User testing (including A/B testing) on the prototype;
  4. Applying this user testing to the release of an alpha and then beta version of user interface;
  5. An application for intellectual property protection for the user interface, in the form of an application to register it as a unique design.

In this example, you can see that there is a link between the R&D and the eventual application to protect the IP in the asset which is produced. This would mean in practice linking from the outset the software development function of the business with the R&D aspect of the business, so that it is all one continuous process. I do not think that an application for a trademark or simply automatically acquiring copyright would be capable of qualifying.

It is important from the outset to consider whether you will want to rely on this success condition, or whether it is going to be more straight forward for you to rely on the employment success condition (number 7). You could then start planning accordingly.

Whichever 2 of the conditions are going to be met, it will be important to involve your endorsing body at the beginning, since it will be them who you will eventually be asking to confirm (if it is the case) that you have met the conditions. Much better to involve them early rather than later.

In relation to each of the criteria, there will need to be a body of evidence documenting how they have been fulfilled. This will ultimately mean accountancy evidence. In relation to the financial and employment conditions, both your endorsing body and the Home Office will want to see evidence produced by an accountant to show that they have been met. So it is best to start planning this now.

Remember that in addition to the success conditions, you will need to meet the other criteria at page 24 of the guidance, including:

  • the applicant has shown significant achievements judged against the business plan assessed in their previous endorsement
  • the applicant’s business is registered with Companies House and the applicant is listed as a director or member of that business
  • the business is active and trading
  • the business appears to be sustainable for at least the following 12 months based on its assets and expected income, weighted against its current and planned expenses
  • the applicant has demonstrated an active key role in the day to day management and development of the business

Possibly the most important aspect of this is ‘active and trading’. Trading denotes buying and selling. So you will need to have started selling and have paying customers, and be able to show accounts / business bank account statements to prove this. Since these visa routes are about scalable businesses, I would expect the sales to be sales of the actual product, rather than, e.g. consultancy-type services. For this reason, from a visa perspective I would plan to have the actual product / platform actually built and to have started receiving income before you get to the point of applying for indefinite leave to remain. Again, the accountancy evidence would be needed to prove it.  To be on the safe side, I would recommend planning to do this by year 2.5 of the visa to avoid any last minute rush.

If the name of your business ends up being different from the name specified in your business plan, then I would recommend getting your endorsing body to confirm when you apply for indefinite leave to remain that it is the same enterprise as covered in the original business plan that was endorsed.

You would need to also show that you have made ‘significant achievements’ under the business plan which was endorsed. Again, the endorsing body would be confirming this so it makes sense to plan it out now with your endorsing body contact, i.e. your plan for how you will do what you said you would do in your business plan.

If, rather than applying for indefinite leave to remain, you wanted to simply extend your visa for another 3 years, then you would need to apply under the criteria set out at page 21 and 22 of the guidance. You would not need to satisfy the success criteria but you would still would still need to show for this that you had made ‘significant achievements’ under the business plan which was endorsed, and that the company was active and trading, etc.

I hope this is helpful. I have helped many clients under the start up and innovator visa pathways (more than any other UK lawyer that I am aware of). So feel free to reach out to me by email if you would like to speak with me or ask any questions.