Sooner or later, a hotel tech founder hears the question in a late-stage deal: "Can you send us your SOC 2 report?" If the answer is no, the next question is whether to start one. It is a real investment of money and engineering time, and the payback depends almost entirely on who you sell to.

This post sets out the pros and cons plainly, with published cost and timing figures, then gives a simple way to decide whether now is the right time.

What SOC 2 is, in one paragraph

SOC 2 is an attestation report issued by a licensed CPA firm against the AICPA's Trust Services Criteria. Security is mandatory; availability, processing integrity, confidentiality and privacy are optional. As Stayntouch explains in its guide for hotel buyers, a Type I report checks whether controls were designed properly at a single point in time, while a Type II report tests whether they operated effectively across a period, typically six to twelve months. "SOC 2 ready" means no audit has happened at all.

The pros

1. It removes a hard gate in enterprise deals

Stayntouch's guide says enterprise hotel buyers and management companies "increasingly require a SOC 2 Type II report as a contractual condition before signing a PMS agreement", and that most procurement teams expect a report covering roughly the prior twelve months. If your pipeline includes groups, brands or management companies, a missing report is not a weakness to argue around. It is a stop sign.

2. It shortens every questionnaire

A current report answers a large share of the questions in a SIG or custom security spreadsheet with one attachment. That matters most for small teams where the CTO is also the person filling in questionnaires. Our security questionnaire readiness checklist shows how much of that work a report replaces.

3. It answers the question hotel groups now ask first

Hotel IT teams have seen what a vendor breach looks like. Infosecurity Magazine reported in January 2025 that a threat actor accessed hotel software provider Otelier and took customer data from brands including Marriott, Hilton and Hyatt, with researchers linking it to infostealer malware and leaked credentials. Independent evidence that access controls are tested over time is a direct answer to that fear.

4. It is still a differentiator in hotel tech

When The Hotels Network announced its SOC 2 Type I in September 2024, it described itself as "one of the first SaaS companies in hotel technology" to reach it. Hotel Tech Report had covered Oaky achieving SOC 2 Type 2 back in October 2020. In a category where many competitors still say "ready" or nothing, a current Type II report is something you can put on the pricing page and in every proposal.

5. It forces good habits early

Access reviews, change management, offboarding and incident response are easier to build into a 20-person company than to retrofit into a 100-person one. The audit gives those habits a deadline.

The cons

1. It costs real money, every year

Vanta puts audit fees at $10,000 to $50,000, with the all-in cost of a first SOC 2 between $10,000 and $80,000 or more. Drata estimates most startups spend $25,000 to $50,000 in the first year, and that maintenance costs $15,000 to $40,000 annually. Both are compliance platform vendors with a commercial interest, so treat the ranges as direction, but both agree on one point: the audit recurs every year.

2. It takes engineering time you may not have

Drata calls internal team time "the largest hidden cost". For a hotel tech company with a small engineering team, those hours come straight out of the integrations and features that win deals with independents.

3. It is slow

Stayntouch puts a first-time Type II engagement at roughly six to fifteen months. If a specific deal needs a report next month, SOC 2 Type II cannot arrive in time, whatever you spend.

4. Type I alone can mean paying twice

Vanta warns that a growing number of buyers ask for Type II and will not accept Type I on its own. A Type I bought to clear one deadline is worth it only if a Type II follows.

5. Many hotel buyers will never ask

Independent hotels and small groups rarely send security questionnaires. If your ideal customer is a 40-room boutique hotel, the money may do more in onboarding or marketing. Our post on choosing between independents, chains and management companies covers how that choice shapes everything else.

6. It does not cover everything buyers ask about

Stayntouch is explicit that a SOC 2 report does not establish GDPR compliance and does not replace PCI DSS for payment security. Stayntouch also notes that SOC 2 is most commonly required by North American enterprise buyers, while ISO 27001 is more frequently expected in European and public-sector procurement.

Pros and cons at a glance

How to decide: three questions

1. How many open or lost deals asked for SOC 2 in the last twelve months? Pull it from your CRM and your closed-lost tags. If security review blocked one or more group deals worth more than a year of audit cost, the case is made.

2. Is your next segment enterprise? If your plan is to sell to hotel chains or management companies in the next 18 months, start now, because the Type II clock takes most of a year.

3. Where are your buyers? North American enterprise buyers lean towards SOC 2; European and public-sector buyers lean towards ISO 27001. Pick the one your pipeline asks for first.

If the answer to all three is no, do not buy SOC 2 yet. Build the overview pack, policies and answer library from the questionnaire checklist, publish a trust page, and revisit in six months. If the answer to any of them is yes, the usual path is a readiness assessment, a Type I to keep near-term deals moving, and a Type II observation window started straight after.

Scope it tightly if you go ahead

Vanta's advice on cost is to include only the Security criteria unless a customer contract calls for more, because each optional criterion adds to the bill and Privacy is the expensive add-on. For a hotel PMS, Stayntouch makes the opposite point from the buyer's side: a vendor that omits Processing Integrity has not had folio and payment accuracy controls audited. Start with Security, and add criteria only when named buyers ask for them.

Either way, this is a go-to-market decision, not just a security one: it changes which segments you can win and how long their deals take. It belongs in your hotel tech GTM strategy next to pricing and targeting.

If you cannot tell whether security review is costing you deals or whether something earlier in the funnel is, the free leak audit will show where group deals actually stall.

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