How To Influence Regulatory Policy

Speaker 0: a lot of startups i deal with are always waiting for the regulators to make up their mind or to put some stuff into place so they can move forward, but that feels like they're stalling while they're doing that. how can startups influence regulatory policies in their industry, and what role does advocacy play in shaping business environments in canada?

Speaker 1: advocacy plays a huge role in shaping the regulatory environment, but it's really important to navigate it carefully. so the first thing that i would say is you never wanna wait for the regulators to do something for you to go and have success with your business. there's a regulatory risk that your business is gonna face based on decisions that the regulator could make, but you wanna be thinking of all different outcomes and moving forward accordingly. the number one step i would say is get legal counsel, legal representation in the industry or in the area where you're waiting for regulatory support. right? if you're applying for some sort of license, don't just apply on your own. have a trained seasoned law firm specializing in this industry, help shepherd your application through the process. that would be my number one recommendation because there'll be things, knowledge that they have that can help you move through the process much faster than it would take if you were doing it on your own. next, typically, and, again, this depends on each industry and each regulator because they're all different. typically, regulators like things that are not being disruptive or rocking the boat. so if you're trying to do something super innovative and you're trying to get licensed in an industry for the first time now this is just my personal opinion. this is not legal advice or anything like that. my recommendation would be get the license in a vanilla way first. don't come in out the gate being like, hey, regulator. your whole industry is wrong, and i'm gonna come in and change everything. and you need to change all the rules for me because i'm gonna mix it up. all that's gonna do is give the regulator a heart attack and make them watch you super closely all the time. my recommendation would get approved, get licensed in a very vanilla way. just say, hey. i'm coming in. i'm doing something standard like you've seen a hundred times yesterday. no weird stuff. nothing strange. get your approval. and then once you're approved as an approved insider of this industry, then go to the regulators saying, hey. i'm already doing stuff in the totally compliant safe way, but i'm thinking about doing this other thing. should i, you know can i go do this way? can i try it that way? that is gonna make, typically, the regulator be much more open to having a conversation with you because the regulator is often looking to ensure that participants in the industry know, respect, and follow the regulation. and if you meet them for the first time and your rules are wrong, and i'm here to, you know, mess stuff up, you know, there's another three word phrase to summarize that. starts with the word f. if you're coming in with that being your objective, the regulator is already gonna be highly resistant to you. so that would be my tip is don't necessarily go in guns blazing out the gate, try to be more vanilla, and then try to innovate once you're already in the space.

Speaker 0: nobody wants you to kick over their apple cart.

Speaker 1: no. especially when it's their job to make sure the apple cart doesn't fall over. and certain regulators, at least in the securities space, like the securities regulators, have the ability to issue fines and jail time without going to the standard judicial court process. they can just straight up assign it to you. they're like, congratulations. you won three years in jail. have fun. so you wanna make sure that before you go knocking over somebody's apple cart, just see how big their stick is, so you can dodge it.

Speaker 0: yeah. and it's always easier to work from the inside for change than to come from the outside.

Speaker 1: absolutely. absolutely.