Are tech solutions in compliance aiding, not replacing auditors like Carta did with lawyers?

In the early days, Carta couldn't give 409A valuations, so they partnered with outside accounting firms to do that. 

Vanta is similar. We can build software that helps someone through an audit. Our software helps an auditor do their work, but we are not auditing the company. We can't. This is per auditor guidelines that say, you can't audit your own work. Running software counts as your own work. We are not an audit firm. We will never be an audit firm. However, we work very closely with some accountants and audit firms. 

These audit firms historically wouldn't work with startups. Their bills would be like $50 to $100K, and a startup would be like, "Well, we're not going to pay that. We’ll figure out a way to grow without a SOC 2 report.”

Vanta came along, and then these startups were actually much better prepared for these audits. The auditor could treat them more like a big customer that had an internal team that knew what was going on. Then there was downward pricing pressure, because so much could be done inside the software.

We've iterated through a few models since we've been at the forefront here and figured this out. Today, we work with this set of very tech-forward, process-based auditors who understand that their ACV might be lower, and they might be charging less, but that they can do Vanta audits so much faster. We’re seeing auditors embrace this lower price, higher quantity kind of revenue growth.