SOC 2 Compliance: A Founder's Guide

The Email That Changes Everything

You're on a sales call with your first enterprise customer. The demo went great. They love the product. The champion on their side is already talking about rollout timelines. Then someone from procurement unmutes and asks: "Are you SOC 2 compliant?"

You're not. And you can see the deal slipping away in real time.

This is the moment every B2B founder hits eventually. It doesn't matter how good your product is. Enterprise buyers have their own compliance obligations, and those obligations flow downhill to every vendor they work with. If you can't prove you handle data responsibly, the deal dies — not because of your product, but because of your paperwork.

The good news: SOC 2 is not as mysterious as it sounds. The bad news: it's not cheap, and it's not fast. Here's what you actually need to know.

What SOC 2 Actually Is

SOC 2 is a framework developed by the American Institute of CPAs (AICPA) for proving that your company handles customer data responsibly. It's not a certification you hang on the wall — it's an audit report produced by an independent auditor that says "we looked at their systems and practices, and here's what we found."

There are two types of SOC 2 reports, and the distinction matters:

Type I is a snapshot. An auditor examines your security controls at a single point in time and confirms they exist. Think of it as a photograph — "on this date, these controls were in place." You can get a Type I done relatively quickly, and it's enough to unblock some enterprise deals.

Type II is the real deal. An auditor examines your controls over a period of 3 to 12 months and confirms they actually work consistently. This is the one serious enterprise buyers want. It proves you're not just setting things up for the audit and letting them rot afterward.

Both types evaluate you against five Trust Service Criteria:

• Security — the baseline, and the only mandatory one. Are your systems protected against unauthorized access?
• Availability — can customers reliably access your service?
• Processing Integrity — does your system process data accurately and completely?
• Confidentiality — do you protect confidential information?
• Privacy — do you handle personal information according to your stated policies?

Most startups begin with Security only. You can add the other criteria later as your customers require them.

Enterprise buyers care about all this because their own compliance depends on their vendors. When a Fortune 500 company undergoes their own audit, the auditor asks about third-party risk management. If their vendors aren't compliant, they aren't compliant. Your SOC 2 report is how they prove to their auditors that they chose responsible partners.

What It Actually Costs

Let's talk real numbers, because this is where most guides get vague.

The audit itself runs $20,000 to $50,000 depending on your scope, your auditor, and how complex your infrastructure is. A straightforward SaaS app with a single cloud provider and a small team is on the lower end. A more complex setup with multiple environments, on-prem components, or a larger team pushes the price up.

Compliance automation tooling like Vanta, Drata, or Secureframe will cost $10,000 to $25,000 per year. These platforms automate evidence collection, monitor your controls continuously, and make the auditor's job easier — which means a cheaper and faster audit. They're not strictly required, but trying to do SOC 2 with spreadsheets and screenshots is a miserable experience you should avoid.

Engineering time is the hidden cost that catches founders off guard. You'll need to implement controls that probably don't exist yet: centralized logging, access reviews, encryption configurations, monitoring and observability systems, vulnerability scanning, change management processes. Depending on how your product was built, this can be a few weeks or a few months of engineering work. If you built your product with AI tools and skipped security fundamentals — something we see constantly — this phase takes longer.

Timeline: Expect 3 to 6 months to get a Type I report from a standing start. After that, you need a 3 to 12 month observation window before your Type II audit can begin. Most auditors recommend a 6-month observation period for your first Type II.

Total realistic cost for a startup: $50,000 to $100,000 and 6 or more months. That includes tooling, the audit, and the engineering time to get ready. You can optimize this — starting with a narrow scope, choosing a startup-friendly auditor, using automation tooling — but don't let anyone tell you it's a $10K project you can knock out in a month.

When to Start (and When to Wait)

Not every startup needs SOC 2 right now. Here's a simple decision framework.

Start now if:

• Enterprise deals are in your pipeline or you're already getting the "are you compliant?" question
• You handle sensitive customer data — financial records, health information, PII
• Your total addressable market is B2B, especially mid-market and enterprise
• You're preparing to raise a Series A or beyond, and investors are asking about security posture
• You operate in a regulated industry where compliance is table stakes (we wrote about this in detail in our post on shipping in regulated industries)

Wait if:

• You're still searching for product-market fit — spend your limited resources on finding customers first
• Your product is purely B2C with no enterprise plans on the horizon
• No customer, prospect, or investor has asked about compliance

The middle ground is the smartest play for most startups: start building SOC 2-ready practices today, even if you don't plan to audit for another year. The practices themselves — access control, logging, documentation — make your product more secure regardless of whether an auditor ever looks at them. And when you do decide to audit, you'll be months ahead instead of starting from scratch.

What You Can Do Today

You don't need an auditor or a $25K platform to start. These are the highest-impact actions you can take right now to build a SOC 2-ready foundation.

Enable MFA everywhere. Every SaaS tool your team uses, every cloud console, every admin panel. This is the single most effective security control you can implement, and auditors check it first. If your AWS root account doesn't have MFA enabled, stop reading and go fix that.

Set up access logging and audit trails. You need to be able to answer the question "who accessed what, and when?" Turn on cloud provider logging (AWS CloudTrail, GCP Audit Logs, Azure Monitor). Enable audit logging in your application. Store logs centrally and make sure they can't be tampered with.

Document your security policies. They don't need to be 50-page legal documents. A clear, honest description of how you handle data, manage access, respond to incidents, and onboard/offboard employees is enough to start. The point is that your practices are written down, not just tribal knowledge.

Implement proper secrets management. No API keys in code. No passwords in environment files committed to git. Use a secrets manager — AWS Secrets Manager, HashiCorp Vault, Doppler, or even your CI/CD platform's built-in secrets. Rotate credentials regularly.

Set up monitoring and alerting. You need to know when something goes wrong before your customers tell you. Uptime monitoring, error tracking, and basic security alerting are the minimum. If someone tries to brute-force your login endpoint at 3 AM, you should find out before they succeed — not after.

Run a vulnerability scan. Tools like OWASP ZAP or Snyk can scan your application and dependencies for known vulnerabilities. A professional penetration test is better, but an automated scan costs nothing and catches low-hanging fruit.

Every one of these actions makes the eventual SOC 2 audit faster, cheaper, and less painful. More importantly, they make your product more secure for the customers who are already trusting you with their data.

The Bigger Picture

SOC 2 is one piece of a larger compliance puzzle. Depending on your industry and customers, you might also encounter ISO 27001 (the international standard, and what we hold at Productera), HIPAA for healthcare data, or industry-specific requirements.

The underlying principle is always the same: prove that you take security seriously, and prove it with evidence — not just promises. The earlier you internalize that principle, the easier every compliance conversation becomes.

If you're a founder building toward enterprise sales and need help getting your product audit-ready, that's exactly the kind of engagement we specialize in. But whether you work with us or not, start with the checklist above. Future you — sitting on that next enterprise sales call — will be grateful.

Related glossary terms: SOC 2 · ISO 27001 · Penetration Testing · Monitoring & Observability · CI/CD · HIPAA