What you are describing is how governments prop-up incumbents. But this rarely apply to startups, who seldom stand a chance at getting government contracts and the like. Entrepreneurs will ignore those and build the startup from the bottom up, with small customers first.

Of course a less corrupt government could help here, like the x-prize helped SpaceX and electric car subsidies helped Tesla. But that's too much to ask from politicians of most countries.

To actually prevent startups competing and disrupting the market, I maintain that regulations are much more effective: they will prevent entrepreneurs from even thinking of entering and competing highly regulated domains. See the three canonical examples (health care, education and housing) where high prices and scarcity are the name of the game.