Compliance isn’t easy. New regulations and frameworks are emerging all the time, and it isn’t always obvious which ones apply to your company — or which may eventually apply. This is a particular challenge for startups with limited resources, who often view compliance as a barrier to critical initiatives like product launches and sales opportunities. Understandably, they tend to focus on business challenges with a more direct and obvious line to ROI.
3 Advantages to Obtaining Data Compliance for Startups
- Data compliance builds trust with customers.
- An early focus on data compliance can help your startup stand out against competitors.
- Data compliance certifications can help you explain security measures and close deals faster.
This is a mistake, and one that underestimates the very real impact that compliance can have on ROI – especially when the cost of noncompliance can be significant. In today’s regulatory environment, compliance isn’t just a “nice-to-have” benefit. It’s something that potential customers and partners will be actively looking for as they seek assurances that their data will be kept safe.
Startups that can demonstrate compliance early have a leg up on their competitors. Streamlining the compliance process can also help them land larger clients earlier, jump-starting their business and paving the way for future success.
Build Trust from the Ground Up With Data Compliance
If you’re running a startup, trust is your most precious asset, aside, perhaps, from time. But to earn that trust, you need to prove you deserve it. Compliance frameworks like SOC 2, ISO 27001 and GDPR provide a tangible, verifiable way for potential partners and customers to gauge your security and privacy program at a time when major data breaches are making headlines on a weekly – even daily – basis. There were 1,802 data breaches reported in the U.S. in 2022, affecting over 422 million individuals, according to a report from Statista.
In our current environment, your word or promise of a sound security posture just won’t cut it. Only the ability to adhere to certain frameworks will allay fears a prospect has, showing them you have the tools in place to combat today’s most common and dangerous threats. Of course, different frameworks will apply to different companies.
For instance, a company operating primarily in Europe would likely prioritize frameworks like ISO 27001 and GDPR, while a U.S.-based operation might focus on SOC 2 first. Similarly, those in healthcare will obviously prioritize industry-specific frameworks like HIPAA. These frameworks are not interchangeable, and understanding and identifying which apply to your specific situation is critical.
This can provide real, tangible benefits for today’s businesses. Before Drata launched out of Stealth, we made sure to first receive our clean SOC 2 attestation. SOC 2 is about demonstrating effective security controls around how data in the cloud is processed and stored. It has become a widely accepted standard, and often a minimum bar, for any company operating in the cloud today. Showing potential customers a clean SOC 2 report from a very early stage was a major reason why we were able to sign our first 100 customers in just 45 days after our public launch.
The ability to quickly and easily demonstrate compliance with a given certification or attestation makes the process of earning trust much simpler. Even if your company can meet security standards without obtaining the official certification, proving it on an ad-hoc basis would require deeply technical (and time consuming) explanations.
It’s much simpler and faster to show potential partners and customers that you’ve taken the steps to achieve compliance with a certification.
Data Compliance Is a Competitive Advantage
Don’t make the mistake of thinking compliance is only for cybersecurity companies: It impacts startups across all industries. Compliance is often an effective way to stand out within an increasingly crowded marketplace.
In fact, compliance is such an effective demonstrator of trust that you may not always need a report in hand to move the needle. Just showing that you are well on your way toward compliance with SOC 2, ISO 27001, HIPAA or other frameworks can show potential partners and customers that you are taking security seriously and building toward a mature information security program.
Micruity, an insurtech company, told us that prioritizing SOC 2 compliance helped them expedite conversations with prospects, who appreciated the peace of mind that comes with a security attestation from an independent auditor. Micruity notes that simply having a report ready to share with new prospects didn’t just shorten their sales cycles, it may have even tripled their win rate. For startups, the dual advantage of shorter sales cycles and increased win rate can be a real competitive advantage.
As data becomes more valuable, proving you can protect it is critical. Companies in every industry are collecting data today, and even if you don’t think SOC 2, ISO 27001, GDPR, or CCPA apply to you now, you never know what you (or your customers) will need in the future. It’s better to prioritize compliance early in the startup process than try to retrofit an increasingly complex system to meet compliance needs later, when potential sales are on the line.
Data Compliance Can Help You Close Deals Faster
Conversations about security are an important part of the sales cycle today, and will arise much sooner than most startups often anticipate. No matter what stage you’re in, it’s not uncommon to undergo lengthy security questionnaires about your controls and the systems you have (or don’t have) in place to protect customer data. These questionnaires are often repetitive, and completing each request manually can significantly slow the sales cycle. Don’t underestimate how long this process can take: gathering evidence from siloed departments and digging for answers can be an arduous process.
The time it takes to pull information on your security posture can significantly delay deals with major prospects. For many startups, failing to navigate through security questionnaires and reviews will have a negative impact on scalability and expanding their customer base. Obtaining compliance early can help you navigate those situations and close deals faster.
Advantages of Data Compliance
Compliance isn’t the most exciting problem to tackle but prioritizing it early can generate significant ROI for startups. By establishing trust and streamlining conversations about data security, compliance can help shorten sales cycles and allow startups to acquire more business, faster. It also represents an increasingly critical way to stand out within crowded industries and demonstrate the sort of forward thinking the partners and customers value.
Avoid thinking of compliance as an inconvenience or a necessary evil. Think of it as an important way to establish trust — the foundation of all relationships. In today’s increasingly digital world, I’ve learned first-hand that you’ll never regret treating trust as your North Star.