SOC 2 for startups: timing, cost and auditors

Prepared by Venture Executive Network from recorded practitioner sessions. Updated November 3, 2026.

LAST REVIEWED 2026-11RECORDED SESSION SYNTHESIS

TL;DR

• The speaker’s view: get SOC 2 when customers need it. The signals he named are a direct request, a move upmarket, and sensitive personal or health data.
• Security is always in scope. Other criteria are added when customers need them. Confidentiality adds a few controls; privacy adds about 20.
• He put typical reports at about $5,000 to $20,000 from low-cost providers, $20,000 to $70,000 from mid-range firms and $50,000 to $150,000 from the Big Four.
• Cost follows the provider type, the number of controls and how many separate processes have to be tested.
• The company defines the scope in the system description. He said to keep it tight and be ready to defend it.
• A Type 2 report covers a period of time. He said the report usually arrives about three months after the period ends, sometimes sooner and sometimes later, or within about a month for a premium.
• He was wary of very low prices and of auditors who quote before asking about your controls.

This page draws on a recorded VEN session with the head of the SOC practice at an audit, tax and advisory firm, followed by questions from founders. The founders included one whose customer was requiring a SOC 2 Type 2 report, one whose only likely need was privacy, one who had been through the process before, and an early-stage team learning ahead of demand. Cost figures are the speaker’s ranges from the session, not price quotes, and will vary by provider.

What is SOC 2?

SOC 2 is a set of criteria from the AICPA for service providers. Each criterion names a risk a service provider should address. You write your own controls to show how you address each risk for the systems in scope, and a CPA firm tests them and issues a report. The speaker called that flexibility one of the great things about SOC 2 compared with some other frameworks.

When does a startup need a SOC 2 report?

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You don’t need a SOC 2 until you need one.

Head of SOC practice, audit and advisory firmrecorded session

The speaker described three approaches:

• Reactive. Wait until a customer asks. This can cost less overall. The risks: a rushed engagement can cost more, and if your controls are not in place when a deal depends on the report, you can lose revenue.
• Proactive. Build the program and go through the audit before anyone asks. This costs more and lowers the risk of being caught short.
• Hybrid. Assess how your current controls would hold up in an audit, so you can move quickly when a customer asks, without paying for the report yet.

He saw no advantage in getting a report years before customers request it. Signals that you will need one soon:

• A customer or prospect asks for it directly.
• You are moving from smaller customers to mid-market or enterprise buyers.
• You handle personally identifiable information or protected health information.

An early-stage founder whose company works with data said the session’s takeaway was to think about being proactive, so compliance does not become a large backlog later.

Which trust services criteria should you include?

Security is always included. The other four criteria depend on what your customers need and the data you handle:

Criterion	When the speaker said it applies
Availability	You make availability commitments to customers.
Processing integrity	You process transactions and customers need them complete and correct.
Confidentiality	The most common add-on. Only a few controls beyond security.
Privacy	You have obligations about how personal data is used or shared. About 20 extra controls on average, beyond security.

A founder who expected to need a report only for privacy, if customers pushed for one, asked who sets the framework for it. The speaker said you do. SOC 2 is a set of criteria from the AICPA, and you write controls that address each risk for the systems in scope. One control can map to several criteria. Customers describe their concerns, and sometimes ask for a criterion by name, but they do not define your controls. If you follow another framework such as COSO, he said there may still be gaps against specific SOC 2 requirements.

For that founder, he suggested steering the customer toward confidentiality first to see whether it meets their needs, because it adds a couple of controls where privacy adds about 20.

What does a SOC 2 audit cost?

The speaker’s ranges per report, which he said vary with each firm and engagement:

Provider type	Range per report
Low-cost providers	About $5,000 to $20,000
Mid-range firms	About $20,000 to $70,000
Big Four accounting firms	About $50,000 to $150,000

For a company of medium complexity, he gave about $50,000 at a mid-range firm against about $120,000 at a Big Four firm. Three factors drive the price.

Whether the firm’s name matters. A Big Four report carries a large premium. The speaker said it makes sense only when you know your customers will look for that name. At three or more times the cost, he said it might be worth it if it wins a large enterprise customer you know expects it. A founder asked how to raise this with a customer requiring a Type 2 report without being told to use “the best one.” He said customers who want a particular firm will let you know, and a report from another firm being rejected should not come as a surprise. Some companies assume a large customer will want a Big Four report and pay for one as a strategic decision when the customer never required it.

How many controls you test. Some providers start from a template of about 150 controls. A control set tailored to your risks can come down to about 40, or fewer, depending on factors such as whether you host your own data or have physical locations. Fewer controls mean less testing, fewer audit hours and less work for your team.

How many separate processes you run. Auditors test a sample, usually 25 to 60 items, from each population. If every application has its own process for something like change control or adding users, each one is tested separately. If the process is the same across applications, the populations combine and one sample covers them.

Risks with very low prices

The speaker had seen reports issued for about $5,000 and said the hours required to meet AICPA requirements do not add up at that price. He raised two concerns:

• The work may be done offshore, and some customers are not comfortable with their information being shared that way.
• Some low-cost firms base their conclusions on testing done inside a compliance automation platform. He said the AICPA has issued several warnings about whether that meets the standard for an attestation engagement. The AICPA moves slowly and these reports are not being withdrawn, but customers who see reports from these firms may not accept them.

He said low cost is not necessarily wrong. It carries more risk, and these are questions to ask.

Who defines the scope of a SOC 2 audit?

You do. The scope is set in the system description, the section of the report that describes your system, and the auditor attests to what it covers. A founder asked whether scope could grow without limit once an auditor starts asking questions. The speaker said that without a clearly defined scope there will be scope creep. With one, the audit stays within it.

He compared it to hiring someone to paint your living room who then starts looking around the garage. The scope still has to cover the risks that matter to your customers, because a scope can be too narrow. Auditors may ask whether other systems belong in scope. If a system does not affect the service you provide, he said there is no reason to include it, and you may have to stand your ground and explain why.

Your cloud host’s report does not cover your side. A founder hosting on a major cloud provider asked whether the provider’s SOC 2 report would be enough. The speaker said it is usually both: the cloud provider appears in your report as a subservice provider, and you still need your own controls on your side of the connection, such as the APIs you expose to customers. If a customer’s only concern is hosting, the provider’s report may give them enough assurance, but you cannot present it as covering all of your risk.

Write the system description yourself. The speaker said many companies do not realize the system description is their responsibility. Some consultants help with it, but it is separate from the audit, and the auditor only gives feedback.

How do readiness, Type 1 and Type 2 work?

Readiness. A consulting engagement that walks through your processes with the people who own each control, finds gaps and checks whether you can produce the evidence. The speaker said most companies already do most of what is needed, such as multi-factor authentication and encryption, because it is the right thing to do. Gaps tend to be administrative, such as a missing risk assessment or policy.

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Doing it and proving that you do it are two different things.

Head of SOC practice, audit and advisory firmrecorded session

Common evidence gaps are logs not kept long enough to test a full year and approvals that happen verbally in a small team. Readiness can be limited to reviewing controls or cover a company that has never written one down. Using the same firm for readiness and then the Type 1 report can make the process smoother, he said, but it is not necessary. Because readiness is consulting, you decide how to remediate the gaps it finds.

Type 1. Tests design and implementation: walkthroughs of each control and one example of evidence, such as a single termination showing access was removed, plus your policies.

Type 2. Tests operating effectiveness over a period. Instead of one example, you provide a complete list of every event in the period, such as all terminations, in a format the auditor can verify, such as a system-generated report. The auditor selects a sample and you gather evidence for each item. The speaker said gathering this evidence is usually the hardest part.

You do not have to get a Type 1 first. The speaker described companies remediating after readiness and going straight into a Type 2, and one founder in the session was pursuing a Type 2 directly because a customer required it.

His practical tip: if you have not worked with the firm before and they ask for 60 items, send one first and ask them to confirm it is what they need before you gather the rest.

You also have to register to use the SOC logo, and the report has to be issued first. He said the auditor can register on your behalf.

How long does a SOC 2 Type 2 report take?

A founder asked how long a Type 2 report would take if controls were in place and had been operating for three months. The speaker’s answer:

• Testing cannot finish until the observation period ends.
• Some work, such as walkthroughs and policy reviews, can happen before the period ends if the firm is willing.
• If there are no issues and evidence comes quickly, a report can be issued within about a month of the period end for a premium.
• The standard timing is usually about three months after the period end, sometimes sooner and sometimes later.

How do you choose a SOC 2 auditor?

When a founder asked for the biggest mistake to watch out for, the speaker named two. The first was too low a price: if a price seems too good to be true, he said, it may be.

The second was over-promising. If a firm quotes a price and a timeline, such as a report in two months, without asking about the maturity of your program or the number of controls, he said they do not know enough to stand behind either.

His other points on choosing a firm:

• Talk to several firms about their approach. Look for an ongoing relationship rather than a transaction. Changing audit firms later is hard, and he said people often feel stuck.
• Look for audit skill first. For technical companies, he said the better auditor is usually someone who started in audit and then learned the technology. The audit tests whether controls work and whether you can prove it over the year, not a full understanding of your architecture.
• Stay in touch during the year. A firm you can reach when your systems or processes change helps you avoid surprises at year end.

A founder asked about using the firm that keeps your books. The speaker said bundling services with one accounting firm can lower the price. The risk the AICPA and others are concerned about is that a firm doing a lot of other work for a client is motivated to give clean opinions. A CPA has to sign the report, but some providers that issue reports do no accounting or tax work. He also said the people doing SOC work at firms generally do not do bookkeeping or tax work. His conclusion was that there is no particular benefit to using your accounting firm. A CPA must sign the report, and CPA firms simply have many CPAs.

Can compliance tools or AI replace the audit?

GRC tools. The speaker said centralized periodic sign-off is a main benefit of governance, risk and compliance software, and SOC 2 does not require it. Depending on how you want to manage things, he said, a GRC tool “might just be an expensive spreadsheet for you.”

What you need is version control and a record of each control, its owner and the systems it applies to.

Compliance automation platforms. He said they have some value and are improving, but often over-promise:

• Their ability to judge whether a control works is limited. He had seen a platform mark an information security policy as passing when the document was blank.
• Integrations that pull evidence from your systems bring those integrations, and the platform, into scope, because the auditor has to confirm they pull complete data.
• They often come preloaded with about 150 general controls, many of which will not apply to you, which means more work and higher audit costs unless the set is tailored.
• One of his clients, years ago, took about a year and a half to work the bugs out of a platform, with someone working on it part-time for a full year to set it up and validate it.

He said this does not mean you should not use one, only that the work and risk should be part of the decision.

AI tools. A founder asked whether the criteria should change because of LLMs, and whether an LLM could produce a valid report. The speaker said the report has to be issued by a CPA. The AICPA has issued statements about AI use by both clients and auditors, and AI tools are hard to get reasonable assurance around unless they give repeatable results that could themselves be audited. He thought it would be hard to use a general chat assistant even for readiness, and did not think it could reliably judge whether your control environment works. Automated controls built into your systems, such as a rule that blocks promotion to production until checks pass, are a different matter. He called them much better, since “humans are the weak link” in most situations, and they can be tested through configuration and access to change it.

How do you keep a SOC 2 program manageable?

The speaker said compliance is nobody’s day job, and larger companies often hire someone just to manage auditors. His practices for the year between audits:

• Keep controls and policies current. When nothing is up to date at the start of an audit, auditors ask more questions.
• Organize your documentation so you are not searching for it every year.
• Keep copies of the evidence the auditor accepted last year. It becomes a reference for each control, since nobody remembers which screenshot worked twelve months later.
• Provide only what the auditor requests. Extra material raises questions you then have to explain.
• Raise big changes mid-year. If a system migration is coming, talking to the auditor first lets you keep the evidence they will need, such as running old and new systems side by side, before data is purged.
• Keep processes the same as you add applications, so each new system does not add controls and cost.
• Educate your auditors. “We’re experts at what we do, but not at what you do,” he said, so explain how your controls address the risk and defend your choices.

Multiple frameworks. Align controls across frameworks where you can, set to the highest required standard, so your team handles one control instead of an ISO version and a SOC version. ISO and HITRUST are more prescriptive than SOC 2, so their control sets run larger. He said testing efficiencies are harder to guarantee. They depend on whether report periods line up and whether the firms will cooperate, and sampling methods differ between frameworks.

Questions to ask a SOC 2 provider

These questions follow from the points the speaker and founders raised in the session. The speaker did not present them as a list.

SOC 2 PROVIDER QUESTIONS

Our customers asked for these criteria. Do you see any gaps in how our controls map to them?
What do you need to know about our controls and program maturity before you quote?
How many controls do you expect us to have? Is the set tailored?
Do you rely on testing done inside a compliance platform?
Where is the work performed, and who sees our data?
Will you review a sample of evidence before we gather the full set?
Can walkthroughs and policy review happen before the period ends?
What is your standard and expedited report timing?
Can we reach you during the year when systems change?
Who registers the logo once the report is issued?

Numbers from the room

Figure	Value
Low-cost provider report	About $5,000 to $20,000
Mid-range firm report	About $20,000 to $70,000
Big Four report	About $50,000 to $150,000
Medium-complexity example	About $50,000 mid-range against about $120,000 Big Four
Template control set	About 150 controls
Tailored control set	About 40 controls, or fewer
Sample per population	25 to 60 items
Privacy criterion	About 20 controls beyond security, on average
Expedited Type 2 report	Within about a month of period end
Standard Type 2 report	Usually about three months after period end, sometimes sooner or later

About $5,000 to $20,000Low-cost provider report

About $20,000 to $70,000Mid-range firm report

About $50,000 to $150,000Big Four report

About $50,000 mid-range against about $120,000 Big FourMedium-complexity example

About 150 controlsTemplate control set

About 40 controls, or fewerTailored control set

25 to 60 itemsSample per population

About 20 controls beyond security, on averagePrivacy criterion

Within about a month of period endExpedited Type 2 report

Usually about three months after period end, sometimes sooner or laterStandard Type 2 report

All figures are the speaker’s estimates from the session. See Benchmarks from the room.

Where this connects

• Selling to the enterprise: the security document to send before a buyer asks.
• Pilots that convert: mapping security review early in a pilot.
• Startup data room checklist: keeping compliance records organized for diligence.

Sources

One recorded VEN session with the head of the SOC practice at an audit, tax and advisory firm, with founder Q&A. The supplied transcript does not state the session date. The session covered SOC 2 timing, criteria, cost drivers, scope, readiness, Type 1 and Type 2 testing, report timing, auditor selection, compliance tools and program management. Participant, firm and company names are omitted.