The startup now has to spend $X more implementing handling those regulations rather than building an MVP and finding PMF. This might be the difference between s

The startup now has to spend $X more implementing handling those regulations rather than building an MVP and finding PMF. This might be the difference between success and failure. Thus there will be fewer successful startups than in the world without the regulation. Conversely a big corporation will lose some % of profit to dealing with the regulation (or perhaps it will just raise prices if it’s not competitive). But it’s not an existential concern.