Right, it's multiple benefits: the soc2 has a lot of overlap with 27001, a bunch of overlap with hitrust, it's a bit easier to do, and the CISOs we talk to want the Type 2. Internally, you can bump up your security practices, eg it forced us into a level of internal controls that was early for a startup. But beneficial, imo. I really can't think of many drawbacks if you work with customers that ask for these things.
In our case, the customer profile is from lower midmarket to Fortune 50.
You probably can close deals (depending customer, obviously) by committing to a Type 1. We did that at the beginning, but it exposes you to a lot more interactions with the security team. While you rarely see deals fail for security reasons, I've had it happen. So my experience is the less interaction you have with them, the better off you are. And a Type II plus the annual (or more than annual) pen tests make a lot of the questioning less intense.
btw (happy to disclose personally, but I keep my identity private on hn), you can get the audit done for a lot less than $70k if you use a smaller firm, and that never was a problem with our customers.
I've seen deals contingent on named and/or Big 4 auditors, so I'm going to go ahead and disagree there too. With major buyers, I think there's pretty general awareness that there's a race-to-the-bottom market for cheap SOC2 assessments.
Anyways: the point I'm making is: a Type 2 probably doesn't do anything more to prepare you for 27001 (which you should not get) than a Type 1 does. The subject matter of the assessments are the same (in fact, the Type 1 essentially sets the playbook for the Type 2, which is something you should be careful about).
Pentest reports can definitely mitigate security objections. T What's funny is that none of these certifications meaningfully require them. All the more reason not to pay much attention to them until you have to.
You should think of SOC2 and ISO 27001 as exotic sales expenses, not as something your startup needs to engineer against.
In our case, the customer profile is from lower midmarket to Fortune 50.
You probably can close deals (depending customer, obviously) by committing to a Type 1. We did that at the beginning, but it exposes you to a lot more interactions with the security team. While you rarely see deals fail for security reasons, I've had it happen. So my experience is the less interaction you have with them, the better off you are. And a Type II plus the annual (or more than annual) pen tests make a lot of the questioning less intense.
btw (happy to disclose personally, but I keep my identity private on hn), you can get the audit done for a lot less than $70k if you use a smaller firm, and that never was a problem with our customers.