SOC 2 GUIDE

SOC 2 Type 1 vs Type 2: Which Do You Need?

Published January 2025 ยท 8 min read

The Key Difference

The fundamental difference is time: Type 1 is a point-in-time assessment, while Type 2 proves your controls work effectively over a 6-12 month period.

SOC 2 Type 1

What it proves:
Your controls are properly designed at a specific point in time
Timeline:
4-8 weeks
Cost:
$8,000 - $20,000
Best for:
Early-stage companies, initial proof of security

SOC 2 Type 2

What it proves:
Your controls operate effectively over 6-12 months
Timeline:
6-12 months (including observation period)
Cost:
$15,000 - $50,000+
Best for:
Enterprise sales, industry standard requirement

What Do Customers Actually Require?

๐Ÿ“Š
Enterprise customers (Fortune 500):
92% require SOC 2 Type 2
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Mid-market customers:
65% accept Type 1 initially, require Type 2 for renewal
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Startups and SMBs:
40% accept Type 1, security questionnaire may suffice

The Type 1 โ†’ Type 2 Path

Many companies start with Type 1 and upgrade to Type 2. Here's the typical progression:

1

Achieve Type 1 (Months 1-2)

Complete control design and documentation. Pass point-in-time audit. Use report for early customer conversations.

2

Begin Observation Period (Months 3-8)

Operate controls consistently. Collect evidence monthly. Address any control failures immediately.

3

Complete Type 2 Audit (Months 9-12)

Auditor reviews 6-12 months of evidence. Receive Type 2 report. Share with enterprise customers.

Cost Considerations

Total Cost Breakdown

ComponentType 1Type 2
Readiness consulting$5K-$10K$10K-$20K
Tools & automation$3K-$6K$8K-$15K
Audit fees$8K-$20K$15K-$50K
Total$16K-$36K$33K-$85K

Our Recommendation

Go straight to Type 2 if: You're targeting enterprise customers, have a 6-12 month sales cycle, or your industry standard requires it (healthcare, finance, etc.).

Start with Type 1 if: You need compliance proof quickly (sales pressure), have limited budget, or are testing market demand for your product.

Accelerate your SOC 2 journey

LowerPlane helps you achieve SOC 2 Type 2 in 6-8 months with 40% automation and expert guidance throughout.

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