Playing by the Government's Rules

Excited to start  your business, but ready to run when it comes to dealing with government regulations? Getting on the government’s good side requires some effort, but the payoff is worth it.

Just ask Gary Golduber, co-founder of DriversEd.com, an online driver-training provider. Started in 1997 as a convenient alternative to boring, all-day traffic school, DriversEd.com needed approval to provide a validated service. The Oakland, California, company started by applying to local court officials for approval. “The challenges were to identify the right state or government agency,” says Golduber, 46, “then to find out what the laws and regulations were in those particular jurisdictions, and to understand the procedures of those agencies and how to work with them.” In California, for instance, Golduber dealt with individual courts that regulate traffic school, whereas in other states, it’s the DMV that holds that jurisdiction.

That kind of research is key to successfully handling government regulations. “Entrepreneurs are very good about getting answers to questions,” says Penny Pompei, president and CEO of the National Women’s Business Center. “The problem is they don’t know what the [right] questions are.” Checking out SBA.gov or contacting your local SBDC office can help you learn the right questions to ask and educate you on the different government regulations your business may have to deal with. These are issues you will want to examine early in your startup, even from the business plan phase.

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It’s the time issue that’s often most challenging for new business owners--dealing with government agencies can try the patience of a now-now-now entrepreneur. It takes a lot of time, says Roger S. Cohen, a government contracting expert and president of Cohen International, a business consulting firm in Nyack, New York. Because regulations can vary by city and state, he cautions startups not to spread themselves too thin by applying to many agencies at once and by expanding too quickly into other municipalities. If you prepare, take your time, and do all the necessary research, government regulations can be just a small challenge to overcome. “If you know what you’re doing,” he says, “it shouldn’t be difficult for you to meet those regulations.”

With patience and diligence, DriversEd.com met the regulations. It is currently operating online driver-training courses in seven states and traffic school (www.webtrafficschool.com) in five states, pushing 2007 sales projections to $7 million.