The Best Time to Focus on SOC-2 Compliance: Series B
After the completion of Series B rounds, business owners are ready to be taken seriously in a competitive marketplace and have all the tools they need to establish a pathway to steady and sustainable growth. So if you’ve just completed your Series B rounds—or you’re approaching Series B— congratulations! The future looks bright; you’re checking off one milestone after another and earning your stripes as a successful business.
At this point, greater success links directly to greater responsibility, and business owners become more heavily committed to shareholders, customers, and regulatory agencies. Throughout Seed funding and Series A, the stakes are lower and mistakes can be considered part of a learning curve. But after raising a Series B, it’s time to strengthen your position in the marketplace by going after larger Enterprise clients; the same clients who will fill your days with questionnaires and spreadsheets if you don’t have a compliance plan in place.
Pause at Series B to Focus on SOC-2 Compliance
Series B marks a crucial turning point in the growth of a new business, and it also presents a valuable opportunity. At this point, financial resources are becoming secure and the company profile is beginning to rise. This is your time to separate yourself from the competition and go after larger clients.
But a high profile can also become a target for auditors, both financial and regulatory. Strong companies should be ready to withstand closer scrutiny on every level, and this means having everything buttoned down and no surprises waiting for auditors in search of weak links.
Data Security: The Best Time to Tighten the Bolts
There are several reasons why the arrival of Series B should push SOC-2 compliance to the top of a company’s to-do list, and most of them come from a simple concept: more moving parts means more to go wrong. Security breaches are almost inevitable—especially in the current threat landscape—but they don’t have to result in total disaster.
Being compliant with the SOC-2 standard proves to your clients and prospects that your team is highly trained, that you understand your data flow, and that you acknowledge your responsibility as a business to do whatever it takes to protect your (and your clients’) data. SOC-2 also means enacting clear processes, actionable forensics, and detailed audit trails. All of these are far easier to establish with a smaller staff and a customer base of hundreds rather than millions.
Lay the Groundwork for the Next Stage
SOC-2 compliance should be well in place before Series C, but if the train is in motion and momentum is taking over, don’t worry; Just pause, get the necessary support, and realize there is no better time to start than today. If your business model requires taking responsibility for sensitive customer data, don’t leave anything to chance. SOC-2 compliance is a bright neon sign that says you are investing in your business and your employees in order to earn your customers and shareholder trust.