Building a startup? Don’t forget the red tape.

Building a startup? Don't forget the red tape. - Professional coverage

According to TechCrunch, on their Build Mode podcast, Startup Battlefield editor Isabelle Johannessen interviewed two founders tackling heavily regulated industries. Gabriel Sanchez, CEO of Enspectra Health, spent a decade getting FDA clearance for a device that aims to replace dermatologist skin biopsies. Meanwhile, Tom Harries, co-founder of Earth Funeral, launched an end-of-life startup that turns human remains into soil, but faced a different challenge: his process was only legal in one state at launch. Both founders detail the tactical planning and immense patience required to navigate these non-traditional startup hurdles, with regulatory clearance dramatically elongating timelines from the very beginning.

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The FDA marathon

Here’s the thing about the FDA: it doesn’t move at startup speed. Gabriel Sanchez’s decade-long journey with Enspectra Health is a brutal reminder of that. We’re talking about a device that touches human health, so the scrutiny is intense and absolutely necessary. But for a founder, that’s a massive test of endurance. You have to keep the company alive, keep your team motivated, and keep believing in the mission while navigating a process that can feel glacially slow. It’s not just about having a great product; it’s about having the operational stamina and financial runway to survive the approval gauntlet. Sanchez’s tactical advice for others in this spot is probably worth its weight in gold.

A different kind of battle

Earth Funeral’s challenge is fascinating because it’s less about a single agency’s stamp of approval and more about a state-by-state political and cultural campaign. The FDA worries about the living, but laying the dead to rest is wrapped in tradition, emotion, and local law. Harries didn’t need a decade of clinical trials, but he needed to convince legislators and voters to legalize a new process. That’s a whole other skillset. It’s about public education, managing discomfort, and literally changing laws one statehouse at a time. In many ways, that’s just as hard as technical validation. You’re not just building a product; you’re shifting a societal norm.

The core trade-off

So what’s the deal with these spaces? Why do founders even bother? The trade-off is clear. The massive regulatory or legislative moat you have to cross becomes your biggest competitive advantage once you’re over it. It keeps other startups out. If you can survive the 10-year FDA path or the grueling state legalization process, you’ve built a barrier to entry that a simple SaaS app could never have. But the cost is immense: time, capital, and a level of uncertainty that would make most founders quit. You have to be building something you truly believe is worth that pain, because the “fail fast” mantra doesn’t really apply here. You can fail, but it won’t be fast.

Patience as a strategy

The biggest takeaway? In regulated industries, patience isn’t a virtue; it’s the core strategy. You plan for the long haul from day one. Your fundraising, your hiring, your product milestones—everything is mapped against a regulatory or legislative calendar, not a typical product launch timeline. It requires a different kind of investor, a different kind of team, and a founder with a stubborn, almost irrational, level of conviction. Basically, you’re playing a completely different game. And for the right problem, it’s a game worth playing, because the impact in fields like healthcare or end-of-life care can be profound. But man, you better know what you’re signing up for.

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