Are you preparing to start such a company? I know zero funders excited about regulation. About technology and platforms, sure. But never about regulation. Only lawyers get excited about that.
Maybe, but GDPR is not the only business-hostile regulation EU has. Together they make an environment in which even 550m users may not be worth it for the small startup. They will simply pivot to the more competitive, but freer, US market.
In that case where there is a proven market demand for idea B you can either compete with company A (which presumably has more resources than you), or enter into a market that company A has willingly forfeited.
I think the second option will have plenty of takers if it turns out that US companies are that scared of GDPR.
