A Playbook for Lobbying Government.

• Author: Batkins, Sam
• Position: Regulatory Hacking: A Playbook for Startups - Book review

Regulatory Hacking: A Playbook for Startups

By Evan Burfield with J.D. Harrison

320 pp.; Portfolio Press, 2018

Should new businesses ask for permission from regulators to employ their business practices, or beg for forgiveness after employing those practices? For countless startups, the product or service they provide may not have clear regulatory guidelines. For others, nascent businesses can often fly under the radar of government until they get big enough and profitable enough to draw regulators' attention.

In a hypothetical world of limited government, small businesses wouldn't need to devote nearly the resources to regulatory compliance that they do in reality. Yet, here we are; there is incredible demand for startups to not only innovate in their market, but also ensure they can do so with the blessing of regulators.

In Regulatory Hacking Evan Burfield, CEO of a startup incubator called 1776, and J.D. Harrison, an executive with the U.S. Chamber of Commerce, describe the government obstacles that innovative firms face and offer strategies for how small businesses can handle the media, regulators, other bureaucrats, and politicians. To partly answer the question on permission or forgiveness, the authors cite the ridesharing service Uber and argue that, at least in some cities, it may have gone about things the wrong way by entering first and asking permission later.

The authors also argue that Elon Musk is the ultimate regulatory "hacker"--the guy who figures out how to break through the regulatory obstacles. (The book was released before Musk's recent run-in with the Securities and Exchange Commission.) That might make many libertarians reflexively gag, and understandably so, but Burfield and Harrison have a point about Musk's success as an innovator. He has built an empire in a variety of green industries that politicians crawl over themselves to support: electric cars, solar homes, and space exploration (just in case the green industry doesn't work out on this planet).

Musk built his empire largely on the back of an adoring press and politicians willing to hand out subsidies to entrepreneurs in his business sectors, but also because--the authors argue--he successfully followed the "playbook" for influencing government. This is the crux of their book. Regulatory Hacking is largely a "how-to" guide for startups to manage policymakers at the state and federal level, employing the grassroots, "grasstops" (i.e., opinion-leaders), and...