8 Early-Stage Hurdles Your Healthcare Startup Could Face—and How To Overcome Them

Founding a healthcare, life science, or biotech company is both exhilarating and unforgiving. The stakes often involve patients’ lives, long, capital-intensive R&D timelines with strict regulatory oversight. Founders must navigate manufacturing, reimbursement and stakeholder alignments, a path where a single misalignment can jeopardize progress. Even the most well-prepared founders may hit a few bumps. Success lies not in avoidance but in anticipation, preparation and adaptation.

To help you prepare, Cure spoke with investor and industry professionals who have built and guided startups. They offered expertise and insight about how to master eight common challenges.

How to Mentally Prepare for Setbacks

Progress comes with uncertainty, noted Brian Brohman, Life Science Advisory Partner at Rev1 Ventures, a venture development studio in Columbus, Ohio.

“You’re working with biology and humans, both of which are unpredictable, and the goal post is constantly moving. Sometimes your technology can’t reach its most ambitious promise, and that’s not necessarily failure,” said Brohman.

What matters, he said, is using the data to ask the next question and prove the clinical utility of your product.

“Even when a trial doesn’t hit every endpoint, it can still advance knowledge and guide you toward the true commercial sweet spot. Each setback is an opportunity to refine your approach and learn where your innovation really fits,” he said.

Keep in mind, too, that success isn’t just about strong scientific data, said Brohman. You also need business evidence early, including regulatory pathways, manufacturing, reimbursement, unit economics, intellectual property (IP), and go-to-market strategy.

According to Brohman, when you have the right mindset about potential obstacles, you approach each day with two goals in mind: reducing uncertainty and generating your own luck. This means: ● Embrace the process and pursuit of converting unknowns into knowns. Every day, aim to reduce uncertainty, whether scientific or business-related. “Progress comes from tackling those unknowns head-on,” he said. ● Engage in CICOL or the constant intentional creation of luck. Luck is “built by consistently telling your story, showing up, and planting seeds that can grow into opportunities. A few new connections each week might lead to partnerships, insights, or shortcuts that save months of trial and error,” he explained. When facing obstacles, challenges, or even setbacks, resilience is key.

“You have to take on this role knowing that there are going to be a number of challenges you have to face,” said Nick Siciliano, PhD, Chief Executive Officer, Co-Founder, and Director of Vittoria Biotherapeutics, a clinical stage company addressing T-cell lymphoma.

He said there are no straight lines when building a startup. “It's not going to go as planned, but understand that any mistake that happens, any issue that happens, if it's not fatal, you can move forward. And, you need to be able to learn from it.”

8 Common Mistakes or Challenges You May Encounter

1. Not Aligning Near-Term Expectations with Investors

When founders and investors are not on the same page about what’s going to happen in the short term, this can create issues, miscommunications, and misunderstanding. So, Siciliano said it's important to make sure your near-term expectations are aligned with your investors or funding partners.

“It's an exciting time launching a new biotech company, particularly when it initially gets financed,” says Siciliano. “But many times, I see founders get lost in that and not do enough work just aligning expectations with investors on near-term milestones. That's one common mistake I see that can be problematic.”

To avoid misalignment, clearly communicate your near-term goals, timelines, and key milestones during fundraising. Make sure your funding partners understand the particular pacing of your startup. This will help build trust and prevent unrealistic expectations from derailing the relationship.

2. Underestimating the Competitive Landscape

According to Brohman, assuming your product, technology, or approach is automatically the best is a huge trap. You need to know the competitive and emerging landscape and understand the “bar” your solution must surpass. “Investors, regulators, and customers want to know if this works, is it better than what’s already out there or coming soon?” he said. “Entrepreneurs who grasp this and can clearly articulate their edge gain credibility and a head start in adoption.”

3. Overspending or Neglecting to Budget Appropriately

It’s not uncommon for early-stage startups to underestimate how long it will take to reach key milestones, leading to premature hiring, overbuilt infrastructure, or unnecessary commitments, said Siciliano. “Particularly in the current funding environment, overspending, such as spending too much money early on, can be problematic and become a liability going forward.”

Likewise, neglecting to budget appropriately can also leave critical gaps in areas like regulatory strategy, clinical planning, or go-to-market execution. When you don’t have a disciplined budget, this can shorten your runway as well as signal to future investors that you may need to improve your financial stewardship.

4. Building Out Teams Too Quickly

When recruiting the initial senior management team, many times early-stage companies will look to individuals who have had tremendous careers in big pharma, said Siciliano. “But they underestimate how much of an adjustment it's going to be for those individuals to go from working in a big pharma environment to a smaller, startup environment.”

Hiring too quickly or bringing senior talent on too early can create a top-heavy organization and blur expectations and responsibilities. Instead, be intentional about hiring for roles that are essential at each stage of growth, and look for people who fit your company culture, not just impressive resumes. This goes for your C-Suite and your advisory board.

5. Failing to Confirm the Unmet Need

While there may be early enthusiasm around funding an initial idea, it's important to keep in mind that what a grant committee values isn’t always what a hospital, payer, or clinician will pay for, said Brohman.

“The key is to validate the unmet need with actual market decision-makers—the people who will buy, adopt, and reimburse your solution,” he says. “Skip that step, and you risk building something academically exciting but commercially irrelevant.”

6. Not Thinking on Your Feet or Rolling Up Your Sleeves

According to Siciliano, if you’re building a startup, it’s crucial that you not only be able to think on your feet, but that you also work wherever you’re needed. “You have to be able to manage risk in every single one of your critical work streams. That really requires rolling up your sleeves.”

It's really an exercise in micromanagement, he said. Because everything can go wrong early on, you have to work closely with everyone, internally and externally, and be realistic about the time it will take to drive the project to fruition.

“Managing expectations and building contingency in the budget are really important,” he said. “Every single work stream, every budget timeline, you've got to build a significant contingency to allow for the smaller bumps. It's the bigger bumps that are going to require more strategic thinking and a bigger pivot.”

7. Failing to Ensure Trial Design Demonstrates Differentiation

Brohman said it’s not enough to show that your technology works. You need to prove why it’s meaningfully better than current options.

“Many innovators generate early data, only to realize their studies didn’t highlight the clinical or economic advantages buyers care about,” he said. “From the start, design trials that show differentiation. Where should this technology fit, and how do you prove it’s superior? That’s the evidence that drives adoption.”

8. Allowing Fatal Mistakes in Quality to Occur

Often quality issues are fatal mistakes that can lead to the end of a company. So make sure you are paying close attention to the processes and that you never skimp on quality.

“Not having quality buttoned up, to me, is something that could lead to a fatal mistake. Quality in how you run your manufacturing process, and quality in how you run analytics,” said Siciliano. “[You need] the quality assurance and quality control processes. You cannot skimp there.”

Siciliano always recommends making the appropriate investments in quality. Because, if you have quality issues with your product early on, you'll lose customers and investors and their confidence. “And if you have quality issues with a therapeutic, you're going to have even bigger problems potentially with safety and efficacy.”

If something goes sideways, Siciliano said companies often don't have the reserve to redo the process development that’s required to get things back on track.

Why Having a Growth Mindset is Key to Your Success

Everything is an opportunity to learn, grow, and improve your approach, said Brohman. Even if something isn't successful, keep in mind that if it arises from well-designed, well-executed studies. It’s not failure—it’s progress, he said.

“Even studies that miss endpoints advance knowledge, prevent others from repeating mistakes, and set up the next breakthrough,” he noted. “On the other hand, self-inflicted missteps, like skipping market research or ignoring regulatory steps, must be recognized and corrected quickly. Good governance, transparency, and communication habits are critical to managing these risks.”

For example, Brohman saif in his first biotech startup, a “scrambled sequence” control unexpectedly outperformed the lead candidate in pre-clinical tests. “Understanding that data took time, but it led to successful human studies and an eventual exit.”

The lesson? He says be transparent, iterate, and use every outcome—even surprises—to find the next opportunity. “That mindset separates the best innovators from the rest.”