By Leith Khanafseh, Managing Partner of Laika Compliance
Let me tell you from experience; tech startups are some of the busiest, fastest-moving companies on Earth. But along with developing a Minimum Viable Product, finding product-market fit, raising capital, and scaling the business, there is an underrated and often overlooked aspect of running a startup: compliance.
If your growing startup wants to work with or sell to large enterprises, you need to comply with information security best practices and reporting frameworks like SOC 1 and SOC 2. That means knowing how to navigate the IT audit process to show that your company is following compliance best standards.
Until recently, there was no way for companies to efficiently demonstrate compliance or verify security practices. Compliance often became a bottleneck and, moreover, a growth blocker for businesses going through enterprise procurement processes. On average, assessors spend 150-200 hours testing SOC 2 controls. If your company is trying to close a big client, that’s time you can’t afford to lose.
Now, there is a better way. New technology capabilities can help automate not just building and managing the compliance process, but the IT audit process as well–affordably and accessibly for startups.
Let’s review the IT audit landscape and see how automated audits can drive bigger value for startups and the clients and industries they serve.
Old-style Audits: Manual Processes, Limited View of Evidence
The traditional IT audit process has involved manual data pulls, questionnaires filled out by humans (with the inherent possibility for human error), and one-time viewpoints of evidence. But these old-style audits have significant technical limitations. A one-time assessment of audit evidence, based on a single point in time, cannot give an accurate assessment of a company’s controls and how they operate over a period of time.
The audit process can also be costly for younger startups (seed to series B) to navigate. If your company has a shoestring budget and limited in-house staff, you probably don’t have the resources or expertise to get through an IT audit without risking significant complexity and delay.
The Next Evolution of Compliance for Startups
What if there was a better way to manage the IT audit and compliance process, without the complexity, friction, and delays of traditional manual processes?
Technology-driven audit solutions are making it more affordable and accessible for tech startups to sail through IT audits in record time and produce the highest quality audits in the industry.
Here’s how a technology-driven approach to compliance works:
- Automated evidence-gathering: Instead of manual data pulls and time-consuming evidence gathering for a traditional audit, a tech-driven audit involves automated evidence-gathering.
- Programmatic assessment: Instead of offline manual fieldwork by auditors, technology-driven audits make it possible for programmatic assessment. What if your audit’s evidence could be gathered faster, with fewer delays and back-and-forth requests from auditors? What if the relevant information for the audit could be all in one place, on one platform, verified instantly by technology with minimum human involvement?
- Test controls continuously over a period of time – not one time: A singular point in time does not provide a comprehensive view of a company’s compliance posture. Technology-driven audits assess a company’s controls over a longer duration – and provide continuous monitoring of an information security program.
Value of Automated Audits for Startups
Until recently, tech startups have often found the traditional IT audit process to be excessively time-consuming, confusing, costly, and uncomfortably unfamiliar to their usual ways of doing business. That’s because tech startups are used to working online, powered by the latest and greatest tech stacks; instead of lengthy offline meetings and manual questionnaires.
Cutting-edge companies need an audit process that understands the nuances of tech businesses, with auditors that know how to use cutting-edge technology. Tech-driven audits better evaluate the security of tech companies.
The future of IT audits will involve more automation, more frictionless audit processes, and ultimately a more transparent, consistent experience. Tech startup leaders should be eager to get audited; they should have confidence in their products and the integrity of their company’s controls and processes. Tech-driven audits, automated evidence-gathering, programmatic assessment, and continuous monitoring can make this future possible – by making the audit process easier for everyone, while ensuring the highest standards of ongoing compliance.