SOC 2 for Startups and SMBs: What it Costs and What to Expect

by cinch i.t. / Friday, 29 May 2026 / Published in Tech Blog

If you run a tech startup or small business that handles customer data, you’ve probably heard of SOC 2 – the gold-standard audit report that demonstrates your company follows strong security controls. Prospective clients (especially enterprise ones) might even be asking for “SOC 2 compliance” before signing a deal. But for startups and SMBs, pursuing SOC 2 raises a lot of questions: How much will it cost us? How long does it take? What exactly do we need to have in place?

In this blog, we’ll demystify SOC 2 for startups and SMBs perspectives, so you can decide how to approach it smartly.

SOC 2 in a Nutshell

SOC 2 is an independent audit (performed by a CPA firm) evaluating your organization’s controls in areas like security, availability, and confidentiality. There are two types of SOC 2 reports.

– Type 1 examines your controls at a point in time.

– Type 2 examines them over a period (usually 3-12 months) to ensure they operate effectively.

For a startup, a Type 1 is faster and cheaper to get (it’s basically a snapshot), but many clients (especially in B2B SaaS) eventually want a Type 2 for the ongoing assurance.

Think of SOC 2 Type 1 as “we have the right controls on paper as of today,” and Type 2 as “we operated those controls consistently over the past X months.”

How Long Does it Take to Get SOC 2 Certified

The timeline can vary widely based on your preparedness, but the common range is between 6 and 12 months for the whole SOC 2 process (especially for Type 2). Here’s why: first, you need to design and implement required controls (policies, security measures, etc.), then operate with those controls in place for the audit period, and then undergo the audit itself.

If starting from scratch, it often takes a few months to get ready (some companies use a “readiness assessment” to identify gaps).

A SOC 2 Type 1 can be achieved faster – potentially in 2-3 months – because you’re just showing controls exist at a point in time. A Type 2 will add the observation period: commonly 3 or 6 months of evidence collection (some startups choose a 3-month audit period for their first Type 2 to speed it up).

Example: If you begin prepping in January, you might do a Type 1 by April, then a Type 2 covering May-October, with a report in November. The larger or more complex the environment, the longer it can take (12+ months).

It’s important not to rush – “rushing without solid foundations often leads to delays later when auditors uncover weak spots”. A recent Scrut report notes most organizations should expect “6 to 12 months for their first audit”, closer to the lower end for a Type 1 and upper end for a Type 2.

How Much Does It Costs to get SOC 2 Certified

There are a few cost components: the audit fees, preparation and consulting costs, and the internal effort/tools.

Fees: For a small business, audit fees typically range from \$10,000 to \$30,000 for a SOC 2 Type 1, and maybe 30-50% more for a Type 2 because of the extra work analyzing evidence over time. Big Four firms charge a premium – often \$60k+, but many reputable smaller firms will do SMB audits in that \$15k range for Type 1 and \$20-40k for Type 2).
Software: Many startups use compliance automation platforms (e.g., Drata, Secureframe, Vanta) which can run \$5k-\$15k/year. These tools connect to your systems and continuously monitor controls, making evidence collection easier and generally reducing labor and audit prep time.
Consulting: If you hire a consultant for readiness, that might be another \$5k-\$20k depending on scope (some companies skip this and use only automation + templates).
Internal: These efforts are not trivial either; your team will spend time writing policies, implementing controls, and collaborating with auditors. Estimates vary, but a small startup might spend 100-200 hours of internal staff time on their first SOC 2 (spread across engineering, DevOps, and leadership).

All-in, a lean startup could potentially do a Type 1 for around \$10k (using a cost-effective auditor and doing a lot in-house), but more commonly startups report totals like \$20k-\$60k to achieve SOC 2 when you factor audit, tools, and staff time. And if you want a very robust process with top-tier auditors and heavy consulting, it can climb into six figures for larger scope.

On an ongoing basis, remember SOC 2 is annual – so think of the cost not as one-time but as part of your yearly compliance budget (though year 1 is usually the most expensive).

As Sprinto notes, “In Total, SOC 2 cost in 2025 averages between \$30,000 – \$150,000 (including hidden costs) depending on organization size and scope”. For an SMB, expect to be on the lower end of that, but it’s still a significant investment.

What’s Needed to Obtain SOC 2 – Controls and Documentation

SOC 2 compliance is built around proving that your organization has the right security controls and processes in place to protect customer data.

For most SMBs and startups, this means implementing a combination of technical safeguards, documented policies, and operational procedures that align with the SOC 2 Trust Services Criteria. While the exact requirements vary based on your environment and scope, there are several core controls and documentation areas that nearly every company will need to address.

Written Policies and Procedures

This includes an information security policy, access control policy, incident response plan, change management process, etc. Auditors will want to see that you have formalized these. They don’t have to be hundreds of pages – concise is fine – but they must cover the required points.

For example, you should document how you onboard/offboard employees, how you handle backups, how often you conduct risk assessments, etc.

Expect to produce 10-20 policy documents. Templates can help (compliance software often provides these).

Access Controls

You should have a system to manage user accounts and permissions. Auditors will check that you promptly remove access when people leave (you’ll provide termination checklists), use least privilege, and enforce good password practices or MFA.

For instance, show that your Google Workspace or Microsoft 365 has MFA enabled for all users, and that engineering access to production systems is restricted and logged.

Infrastructure and Change Management

Document that your systems (cloud servers, etc.) are securely configured (perhaps using CIS Benchmarks) and that you have a process to apply updates. Use a version control system and code review for changes, and have something like a change log or ticketing system to show how changes are tracked.

Vulnerability Management

You’ll be expected to run regular vulnerability scans and remediate findings. Keep evidence (reports from tools like Nessus or cloud security scans) and show a policy of timely patching.

Monitoring and Incident Response

Auditors want to see that you monitor for security events (could be as simple as reviewing AWS GuardDuty alerts or Windows event logs regularly) and have an incident response plan. You’ll likely need a basic logging mechanism – e.g., retain logs from critical systems for 90 days – and an incident log of any security incidents and how they were handled.

Business Continuity and Backup

If you claim availability or confidentiality trust criteria, show you have backups of critical data and have tested restoring them. Also, some form of redundancy or disaster recovery plan for key systems is expected.

At least annually, test your backups or DR and document the results.

Vendor Management

Keep a list of key vendors (like hosting providers, payment processors) and evidence that you assess them (many companies just keep copies of their SOC reports or security questionnaires).

Security Awareness Training

Show that employees get cybersecurity training initially and perhaps annually (could be simple slideshow training or using an online platform). Maintain records (like training sign-off or quiz results).

Bonus: have them sign acceptable use policies.

Physical and Environmental (if applicable)

If you have an office with sensitive data or on-prem servers, have controls like door locks, visitor logs, etc. Many startups now are cloud-only and remote, so physical controls are minimal (just ensure laptops have full disk encryption and perhaps a device inventory).

Privacy and Confidential Data Handling

If you tout privacy controls (or if privacy is in scope), ensure you have notices, data classification, encryption of data at rest and in transit, and access controls around sensitive info. Even if not formally in scope, encryption in transit (TLS) and at rest for important data is generally expected nowadays.

Evidence Collection

During the audit, for each control, you’ll need to show evidence. E.g., if a control says “User access is reviewed quarterly,” be ready to show the last couple of access review spreadsheets or tickets. If “backups are performed daily,” show backup logs or screenshots.

Automation tools can collect some of this (like pulling user lists and checking MFA settings, etc.), but some will be manual.

One Useful Bonus Tip

Perform a readiness assessment or gap analysis first (either internally using a checklist or with a consultant). This will highlight what you need to implement before you pay for the audit. Many SMBs find value in a pre-audit (sometimes called a SOC 2 readiness project), which might cost ~$10k but saves you from failing the real audit.

Tips to Streamline SOC 2 Compliance for SMBs

Achieving SOC 2 compliance can feel overwhelming for SMBs and startups, especially when balancing limited time, budget, and resources. The good news is that with the right approach, the process can be far more manageable than many companies expect.

By focusing on the essentials, using the right tools, and planning strategically, businesses can streamline the path to compliance while also strengthening their overall security posture:

Scope smartly: You can limit SOC 2 scope to certain systems (e.g., just the product you sell, not internal IT or other business units). Auditors often let you narrow the scope to what’s necessary. This keeps effort focused.
Use automation: Tools like Drata, Vanta, Secureframe, etc., can auto-verify a lot (like checking AWS security settings, collecting screenshots). Over 60% of organizations say automation has significantly reduced their SOC 2 costs. It also reduces human error.
Implement core controls early: For example, start requiring MFA for all accounts, start logging things, write the key policies – even before officially pursuing SOC 2. These are best practices that will not only prepare you for SOC 2 but also improve security (and can be selling points to customers in the meantime).
Budget both money and time: Don’t underestimate the internal workload. It often falls to the CTO/CEO at startups to drive this – but try to delegate specific controls to specific owners (e.g., HR handles HR-related controls, DevOps handles backup and infra controls, etc.). Keep a project plan.
Type 1 vs Type 2 strategy: Some startups get a Type 1 first (quick win to satisfy some clients short-term), then do a Type 2. Others go straight to Type 2 because some customers only care about Type 2. Evaluate what your market expects – if you’re selling to enterprises, they often want a Type 2 eventually. If you do Type 1, know that you’ll still need to do Type 2 later, but Type 1 can be a confidence builder and uncover any issues with your controls when stakes are lower.
Choosing the auditor: Pick a firm experienced with SMBs/startups. They’ll be more efficient and practical. Big 4 firms can impress enterprise customers, but as noted, they cost more (sometimes double) and are very stringent. Many times, a respected boutique CPA firm is perfect. Also, some auditors will negotiate multi-year pricing (charging a similar amount for Year 1 and Year 2 audits, even though Year 2 Type 2 is more work, to win your business). So ask about that.
Don’t treat it as a checkbox-only exercise: SOC 2 can improve your operations – forcing you to back up data, formalize processes, and improve security in ways that save you from incidents. If done with the right mindset, the same controls that get you SOC 2 compliant will also protect your business (e.g., you’ll reduce chances of breaches by patching regularly and using least privilege access).

The Bottom Line for SMBs

For many SMBs and startups, SOC 2 can initially seem intimidating due to the perceived cost, complexity, and time commitment involved. However, when broken down into manageable phases, the process becomes far more achievable.

Understanding the realistic investment required, from budgeting and timelines to implementing the necessary controls, helps organizations plan effectively and approach compliance with confidence rather than uncertainty.

Cost – think tens of thousands of dollars spread across audit and prep
Time – roughly 6-12 months for full Type 2 (possibly less for Type 1 initial step)
Needed controls – a set of policies and security practices that, while rigorous, are achievable for a small company especially with modern cloud tools. SOC 2 is a big undertaking for a small organization, but it has become almost a rite of passage for growing tech businesses.
You don’t have to go it alone – there are consultants and tools (and even our own Cinch I.T. compliance services) that specialize in guiding SMBs through SOC 2 without breaking the bank or derailing your dev roadmap.

With careful planning, you can attain that SOC 2 report to proudly show prospects a clear signal that even as a smaller company, you take security seriously and have “enterprise-grade” controls in place.

Secure the trust, unlock bigger deals, and actually improve your cybersecurity posture along the way. Now that’s a win-win outcome worth the effort.

Internal Resource

For help on your SOC 2 journey, our IT Compliance consulting at Cinch I.T. Denver can assist in implementing the needed controls (from documentation to technical safeguards) and even perform a readiness review. We’ve helped other Denver startups get SOC 2-ready by establishing robust security & compliance frameworks.

From writing custom policies to setting up tools for log management and backup, partnering with experts can accelerate the process and ensure you pass your audit with flying colors. Feel free to reach out for a consultation on demystifying SOC 2 for your business needs.

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About the Author

Niko Zivanovich is a Cybersecurity Leader with experience in helping organizations understand and achieve a more complete security posture. He is a co-owner of Cinch IT of Denver and has been working at Pellera Technology Solutions for 6 years, most recently as the Director of Cyber Defense and Threat Intelligence. Niko specializes in CISO advising, netsec ops, incident response, pen testing, and threat intelligence research. He holds multiple certifications through the SANS GIAC organization and is a Board Director for the InfraGard Colorado and Wyoming Chapter.

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