When you need SOC 2, what it costs, and how to prepare. A practical guide for startup founders.
Larger companies often won't close deals without SOC 2. If you're selling to enterprise, expect this question.
If you process financial, health, or other regulated data, SOC 2 demonstrates you take security seriously.
Investors increasingly expect security foundations in place. SOC 2 signals maturity.
In crowded markets, security certifications can be a differentiator against competitors without them.
SOC 2 has five criteria. Security is always required; the others are optional.
Protection against unauthorized access. Always required.
Examples: Access controls, encryption, monitoring, incident response
System is available for operation as committed.
Examples: Uptime SLAs, disaster recovery, capacity planning
System processing is complete, valid, and timely.
Examples: Data validation, error handling, processing monitoring
Information designated as confidential is protected.
Examples: Data classification, encryption, access restrictions
Personal information is collected, used, retained appropriately.
Examples: Privacy notices, consent management, data retention
Vanta, Drata, Secureframe, etc.
One-time for initial certification
Annual renewal
Engineering, ops, and leadership time
Total first year: $50K-150K depending on company size and approach. Annual renewal: $30K-60K.
SOC 2 audits your existing security practices. If you don't have practices to audit, start there. Run security scans, implement authentication properly, protect customer data. Then certify what you've built.
Start with a Security ScanSOC 2 is expensive if you have to build security from scratch during prep. Start with good practices now, and certification becomes documentation, not transformation.
Free Security ScanType 1 assesses whether your controls are properly designed at a specific point in time. Type 2 assesses whether controls operated effectively over a period (usually 3-12 months). Most enterprises want Type 2 because it proves sustained compliance, not just good intentions.
From starting preparation to Type 2 report: typically 9-18 months. Breakdown: 2-4 months prep, 1-2 months Type 1 audit, 3-12 months observation, 1-2 months Type 2 audit. You can get Type 1 faster (4-6 months total) if you just need something to show customers.
Budget $50K-100K for the first year including platform, auditor, and internal time. Ongoing: $30K-60K annually. Costs vary by company size, complexity, and auditor choice. Using a compliance platform (Vanta, Drata) reduces effort but adds cost.
Usually not for early-stage. Most seed-stage startups don't have SOC 2. It becomes important when: enterprise customers require it, you hit product-market fit and need to scale sales, or you're raising Series A+. Focus on actual security practices first; certify when business requires it.
Yes, but it's more work. Platforms automate evidence collection, provide policy templates, and streamline auditor communication. Without one, you'll spend more engineering time on manual evidence gathering and documentation. For small teams, the platform cost often saves more in time.
Last updated: January 16, 2026