Cyprus has introduced a series of significant changes to its Startup Visa program, designed to make it more appealing for entrepreneurs and investors from around the world. The updates, which came into effect on January 1, 2025, aim to enhance the ease of access for non-EU nationals looking to establish startups in Cyprus, while also boosting the country’s entrepreneurial landscape.
Announced by Nicodemos Damianou, the Deputy Minister for Research, Innovation, and Digital Policy, these reforms are part of Cyprus’s broader effort to foster innovation and attract foreign talent. The country, which is already an EU member, is also on track to become part of the Schengen Area, adding another layer of opportunity for startup founders.
Key Changes to the Startup Visa Program
Several notable adjustments have been made to the rules governing the Cyprus Startup Visa program, making it easier for non-EU nationals to move to Cyprus and set up their businesses. Here’s an overview of the key updates:
1. Extended and Simplified Residence Permits
One of the most significant changes is the extension of residence permits for startup founders and their teams. Under the new regulations, residence permits will be valid for three years, with simplified renewal conditions. This gives entrepreneurs more stability and time to develop their businesses without the constant pressure of visa renewal.
2. Lower Equity Requirements
The equity requirement for applicants has been reduced significantly, from 50% to 25%. This makes it easier for entrepreneurs to retain more control over their businesses while still benefiting from the support of external investors or partners.
3. Foreign Workforce Flexibility
Another important adjustment is the allowance for foreign workers to make up 50% of the startup’s workforce. This offers entrepreneurs greater flexibility in hiring the talent they need, especially in specialized roles where local expertise may be limited.
4. Investment Incentives
Startups that invest at least €150,000 in Cyprus will be able to hire additional foreign employees. Furthermore, startups with annual revenues exceeding €1 million or those that dedicate more than 10% of their operating costs to research and development (R&D) will be subject to tailored evaluation criteria. This provides additional incentives for startups looking to scale quickly.
5. Clearer Renewal Criteria
From 2025 onwards, startups will need to meet certain benchmarks for permit renewal. These criteria include achieving a minimum 15% revenue growth, investing €150,000 in the business, creating at least three new jobs, or launching new products or services. Additionally, employees are expected to demonstrate basic digital skills, ensuring that startups remain innovative and competitive.
The Cyprus Startup Visa Program: An Overview
The Cyprus Startup Visa program is part of the government’s broader strategy to strengthen its entrepreneurial ecosystem. The scheme is valid until December 2026, with a cap of 150 visas issued per year. The program is divided into two categories, depending on the applicant’s stage and structure:
- Individual Startup Visa: This category is for solo founders who plan to establish an innovative startup in Cyprus.
- Team Startup Visa: This allows up to five non-EU nationals to apply as part of a team, either as co-founders or including senior executives alongside the founders.
Eligibility and Application Process
Category A: Startups in the Pre-Revenue Stage or with Revenue Under €1 Million
For startups in the pre-revenue stage, the business must show significant potential for innovation, even if it has not yet generated income. To apply, entrepreneurs must submit a business plan that:
- Demonstrates the startup’s alignment with the EU’s innovation definition.
- Outlines the potential for groundbreaking or improved products, services, or processes.
- Highlights a scalable business model or platform with the potential for international growth.
Category B: Startups with Proven Revenue
Startups that have already surpassed €1 million in annual revenue must meet specific criteria for this category. To apply, applicants need to:
- Submit an application that meets the EU’s innovation criteria.
- Provide an external auditor’s certificate verifying that the startup has earned at least €1 million in revenue from its products or services.
- Show that R&D expenses account for at least 10% of total operating costs in one of the past three tax years.
- Include audited financial accounts detailing R&D expenditure.
Additional Guidelines for Application
The application process requires applicants to complete a detailed business plan and submit supporting documentation in English. The business plan will be evaluated by independent assessors based on specific criteria, and startups that score sufficiently high on these evaluations will be deemed “innovative.”
Startups that qualify may then be granted a visa, allowing the founders and their team to reside and work in Cyprus while developing their business. If the business meets the program’s ongoing requirements, the residence permit can be renewed.
Conclusion
Cyprus’s revamped Startup Visa program offers an exciting opportunity for entrepreneurs from outside the EU to establish innovative startups in a dynamic, growing market. With extended residence permits, reduced equity requirements, and more flexibility in hiring foreign talent, the new program is positioned to attract a diverse range of high-potential ventures.
As Cyprus continues to enhance its position as a business hub in Europe, the Startup Visa program offers a clear pathway for ambitious entrepreneurs to take their businesses to the next level. Whether you are just starting out or already have a thriving business, the Cyprus Startup Visa could be the key to unlocking new opportunities in one of Europe’s most attractive destinations for innovation and entrepreneurship.
For more detailed information on startup visa services, visit StartupVisa.com.
