As you dive deeper into the ins and outs of building and growing a startup, there’s a good chance you’ll come across SOC 2 compliance requirements. Although these audits are standard with massive enterprises, obtaining and maintaining compliance is becoming more critical for businesses across the board, including startups.
Although you might be tempted to set SOC 2 compliance requirements to the side, they’re critical for many startups. This article reviews SOC 2 and why it’s an essential piece of the puzzle, so continue reading to learn more!
What Is SOC 2?
SOC 2 is an auditing standard that measures and tests an organization’s information security and privacy controls. The American Institute of Certified Public Accountants (AICPA) maintains this standard, and the system is objective and taken from a third-party’s standpoint.
Businesses with SOC 2 compliance essentially show customers they’re trustworthy and will handle private information carefully to ensure it doesn’t end up in the wrong hands. While this compliance audit is typical for all types of businesses, it’s particularly sought after by startups as it serves a vital role for any company utilizing the cloud to store private customer data.
Why Is SOC 2 Important For Startups?
Although SOC 2 compliance is essential for companies across the board, it’s vital for many startups. Unfortunately, security is often set on the back burner with startups, as there’s so much to worry about in the initial stages. However, while it’s easy to forget about security, there are a few key reasons why SOC 2 compliance is critical for startups, including the following:
Opens Doors For Growth
As a startup, getting your foot in the door is essential to the growth process. For this, you need to build your reputation and earn customer trust. Without these components, your startup may struggle to take off.
SOC 2 compliance is often crucial to building trust with potential clients. For example, it isn’t unheard of for a business to pause on a sales deal due to the lack of a SOC 2 report – many enterprise companies expect all businesses (including startups) to meet the same procurement and compliance requirements. So, by ensuring your startup complies with SOC 2 via a report, your client may feel more comfortable proceeding with the business deal.
Mitigates Cybersecurity Risks
Although the internet provides excellent opportunities for networking and growth, it also creates a different aspect to worry about: cybersecurity breaches. Cybersecurity breaches can devastate any business, leaving their customers’ private information open to hackers.
With a clean, strong SOC 2 report, you can proceed with peace of mind, knowing your company is at a lower risk for these attacks. An independent attestation stating the company has robust cybersecurity measures in place is necessary to obtain these reports.
If there are holes in your cybersecurity controls, you can adjust your protection plan as necessary to close those gaps and protect customer data.
Aside from boosting customer confidence and trust, SOC 2 compliance aids in creating a security-first culture within your startup. If you implement these practices right out of the gate, you can skirt potential issues instead of dealing with the consequences.
This can help avoid expensive errors that demand precious time and resources. On top of that, the security-first mindset helps develop scalable and secure methods for attracting more prominent customers, increasing data handling abilities, and potentially creating new products.
Get A Jumpstart On SOC 2 Compliance With Help From Insight Assurance
As you develop your startup and iron out the wrinkles, it’s not a bad idea to start thinking about SOC 2 compliance. The earlier you initiate the SOC 2 process, the less time and money you’ll devote to making changes, as smaller staff teams often translate to quicker and more efficient policy adjustments to meet these requirements.
However, while compliance with SOC 2 requirements is critical, achieving this can seem overwhelming, especially with everything else associated with startups. This is where our team at Insight Assurance comes in. We offer readiness and examinations related to SOC 2 to help you determine whether your business’ security is up to par.
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