When to invest in HIPAA compliance tools: a stage-based guide for digital health founders

If you’re building in digital health, you’re operating in a world where expectations around software security, privacy, and compliance are stringent and oftentimes cloudy. Earlier this year, a well-funded AI startup made headlines on Hacker News for accidentally exposing sensitive training data, costing them a major customer and a lot of trust. These stories are everywhere. No tool can guarantee you’ll never have a breach, but a strong security and compliance program, whether manual or automated, is your best shot at catching issues before they go public.

For digital health founders, the real question isn’t whether you should care about compliance. It’s how to care about it without derailing product, sales, or your entire burn rate.

Should you invest in a compliance automation platform like Vanta or Drata? Use a HIPAA compliant managed hosting provider like Aptible? Keep things lightweight until customers or regulators force your hand? Or are you still early enough that you can push serious investment in security and compliance a bit further out?

Aptible’s founders have co-founded and scaled companies that sell into regulated buyers, and we’ve watched a lot of startups learn compliance lessons the hard way. We’ve seen teams waste months and burn precious cash on tools they didn’t need. And we’ve seen teams lose make-or-break deals because they waited too long. This guide is the advice we wish someone had given us before we started building (and it’s the same advice we’ve been sharing with startups on Aptible since 2013).

What to expect from this guide

If you’re a founder or early CTO at a digital health startup, you’ve probably wondered some version of: “Do I really need to care about compliance yet, or is this just another distraction from building product?”

This guide is written from a founder’s point of view. We’re not going to compare every feature across platforms. There are plenty of listicles for that. Instead, we’ll focus on the real world decisions you need to make:

• When it’s actually ok to do nothing (and when it’s not)

• The small “baseline” moves that prevent painful rewrites later

• When compliance automation tools like Vanta and Drata save time and money (especially for SOC 2)

• Where HIPAA compliant hosting like Aptible fits, and what it covers vs. what it doesn’t

• When you need a real internal owner (and what tools can and can’t replace)

If you want a quick feature comparison, there are good third party reviews out there. If you want to make the right call for your stage, team, and go to market in digital health, read on.

👌 Our goal: help you make the most growth-oriented compliance decisions while keeping your team focused on what differentiates you in the market.

What digital health founders get wrong about compliance

Most of the painful stories we hear from founders start with one of these mistakes:

Treating compliance like a checkbox.

Compliance isn’t a project you complete and file away. Once you’re in the game, it doesn’t stop. Policies need to be maintained, controls need to be run, and audits keep coming. If you plan around a one-time push, you’ll either fall out of compliance or bury your team in surprise work later.

Buying policy templates and never really using them.

It’s very common to see startups buy “HIPAA policy packs,” upload them to a drive, change the logo, and call it done. On paper, they now have policies. But in reality, nobody follows them and they don’t match how the product actually works. If you later have a breach and investigators discover that you claimed to follow controls you never implemented, that’s not a small paperwork issue. It can quickly turn into negligence, real fines, and a very bad fundraising conversation.

Buying a compliance tool instead of bringing on internal expertise.

Tools like Vanta and Drata are attractive because they promise checklists, dashboards, and automations. For many founders, they also feel like a shortcut to avoid bringing someone into the company who actually understands HIPAA, SOC 2, or HITRUST. That tradeoff usually backfires. Tools can tell you that a control “exists.” They can’t tell you if it’s well designed, secure, or appropriate for your risk. (More on this later.)

Assuming “compliant” means “secure.”

You can be technically compliant and still have a weak security posture. A concrete example from our internal compliance team: you can connect a data loss prevention tool, turn it on, and create a single rule that allows everything. You’ve technically checked the compliance box. But the risk reduction is near zero. Many automation platforms are optimized to confirm the presence of tools and policies, not the depth of their configuration.

Underestimating the operational cost.

Once you’re in HIPAA and SOC 2 territory, you’re on the hook every year. Risk assessments, control reviews, training, incident drills, vendor reviews, and so on. Whether you handle it manually, with tools, on Aptible, or some mix, you’re making a commitment. You want that commitment to be deliberate, not accidental.

With that context, we can talk about which tools actually make your life better at each stage vs. which ones just move work around.

What are compliance automation tools?

Compliance automation tools, often called governance, risk, and compliance (GRC) platforms, include software like Delve, Vanta, Drata, Sprinto, and others (a complete list would be outdated within a month or two given the speed at which these tools pop up). These platforms automate pieces of achieving and maintaining compliance with frameworks such as SOC 2 and HIPAA (though typically not HITRUST).

Their core value propositions are:

Automating evidence collection.

They connect to your systems and pull screenshots, configuration data, and logs so you don’t have to chase them down every audit cycle. This is powerful once your environment is large enough. For a three person team with a single cloud account, it can be overkill.

Centralizing policy management.

They give you a home for policies, owners, and review dates. Helpful once you have more than a handful of policies. If you’re still copying templates from Google and almost nobody has read them, you have deeper problems than a missing policy library.

Managing audits.

They track requests from auditors and map them to evidence. This can save you a lot of spreadsheet pain once you’re doing recurring SOC 2 work. (Just remember that auditors still want to see real evidence, not only tool screenshots.)

Reminders and task management.

They help prevent things from falling through the cracks as your team grows. For small teams, a shared calendar or Notion board can cover most of this for a while.

Vendor and integration management.

They can track your vendors and associated risks. This matters more as you accumulate a long tail of business associates, subprocessors, and integrations. Early on you can manage this with a simple inventory and some discipline.

Startups typically consider these platforms when:

• A customer or partner demands SOC 2 or other HIPAA evidence

• They want a trust center to share security posture with prospects

• They’re preparing for a formal audit and want to get “audit ready”

Most platforms now bundle a trust center, basic templates, and sometimes “white glove” support where their team does a lot of the initial setup and documentation for you. Pricing ranges from low thousands to tens of thousands per year.

These tools absolutely have their place. The mistake is assuming they’re mandatory on day one, or that they can replace understanding what you’re signing up for.

What is HIPAA compliant hosting?

HIPAA compliance isn’t just paperwork. If you handle PHI, a big chunk of your risk lives in how you host and operate the systems that store and process it.

HIPAA compliant hosting is an infrastructure setup that’s designed for regulated workloads from day one. In practice, that means you’re getting the core technical safeguards you’ll be expected to show (things like encryption, logging, access controls, secure backups, and audit trails) without reinventing them from scratch.

Aptible (and a small number of other providers) offer managed environments with these controls baked in, plus a HIPAA Business Associate Agreement (BAA), so you’re not stuck negotiating and assembling compliance-grade infrastructure on your own.

What HIPAA compliant hosting does well

HIPAA compliant hosting is most valuable when your biggest compliance exposure is at the infrastructure layer and you want to avoid a painful “we’ll fix it later” rewrite.

It tends to be a great fit when:

• Your PHI systems live in one place. The more consistently your sensitive workloads run on a compliant platform, the easier it is to keep scope under control.

• You need audit-ready infrastructure controls without building a DevOps/compliance ops machine. Encryption, backups, logging, and change history are table stakes, but implementing them well (and proving it) takes time.

• You want fewer ways for humans to mess it up. A lot of compliance problems are just “someone accidentally did the unsafe thing.” Guardrails matter.

• You’re trying to move fast while still meeting enterprise expectations. Especially in healthcare, “we’re working on it” isn’t an excuse buyers accept when it comes to compliance.

What HIPAA compliant hosting doesn’t do

This is the part that’s easy to miss: HIPAA compliant hosting doesn’t run your whole compliance program. It covers a lot of the infrastructure-heavy requirements, but it doesn’t automatically handle things like:

• workforce training and HR onboarding requirements

• policies and documentation across your org

• company-wide identity and access reviews across every SaaS tool

• vendor management workflows beyond what touches your hosting layer

• SOC 2 evidence collection across the business

That’s why HIPAA compliant hosting often pairs well with other tools and processes as you scale, especially when customers start asking for broader proof.

Where Aptible fits

Aptible is built to handle the infrastructure side of security and compliance for regulated teams without forcing you to become an expert in building compliant infrastructure on AWS.

In practice, founders tend to care about things like:

• Built-in infrastructure controls (encryption, logging, backups, monitoring)

• Audit logging and compliance reporting you can hand to customers or auditors

• A foundation that supports stricter frameworks over time (like HITRUST and SOC 2)

• A compliance dashboard to monitor posture and surface actionable recommendations

• Real humans who can sanity check your approach when auditors or customers get weird

If your sensitive systems live on Aptible, you’re not starting from zero when someone asks “show me how this environment is secured.”

Key triggers for compliance in startups

When does compliance become mission-critical for a digital health startup?

There’s no perfect rule, but in practice compliance becomes a strategic priority when:

You’re managing sensitive data, especially PHI.

Storing or processing protected health information puts you into HIPAA territory. You also need to think about broader privacy regimes like GDPR earlier than many founders expect.

A customer deal hinges on it.

This is the most common trigger. A hospital, health system, or payer has a policy that requires SOC 2 or HITRUST before they can sign. For HIPAA, they’ll probably want a Business Associate Agreement and proof you’re following strong security practices.

You plan to sell to or partner with enterprises or regulated verticals.

Healthcare, finance, and insurance buyers usually have minimum security requirements. Some will accept strong evidence and a BAA. Many will eventually require formal certifications.

📝 NOTE: There’s no such thing as a formal “HIPAA attestation” or audit. What customers usually want is a signed Business Associate Agreement (BAA) if you’re handling PHI and evidence that you’re following strong security practices; some may ask for even higher standards, like HITRUST certification.

You’re fundraising beyond the first check.

At seed, many investors will take your word for it on security. By Series A and especially Series B, serious investors look at your risk posture, not just your product and revenue. Sloppy compliance and weak documentation can absolutely slow or kill a round.

You start hiring and scaling.

As headcount grows, access control, onboarding and offboarding, and day-to-day process discipline get much harder. This is generally the point when “we’ll just keep a spreadsheet updated” stops working.

Founders often talk about compliance as a binary necessity. Either you need to satisfy a framework for a customer, or you don’t. In our experience, that framing is too simplistic.

If you’re touching PHI, you’re better off investing in strong security practices from day one. Compliance is the art of proving to outsiders that you’re actually following those practices. The real decision is how much to invest, and how, at each stage.

The compliance checklist: when it’s ok to do nothing and when it isn’t

Founders often treat compliance like a single decision: Do we do it now or later? Do we buy a tool or not?

In reality, compliance is a set of problem areas that mature at different times. The right move depends on how hard it is to fix later and when someone will ask you to prove it. And most mistakes happen when you either:

• do nothing in an area where waiting is expensive or legally risky, or

• over-invest in an area where it’s still fine to keep things light

A better question is: for each compliance area, when is it ok to do nothing, what’s the lowest-effort “good enough” step you can take now, and what will you eventually need as you scale?

Here’s a simple checklist you can use.

1. Infrastructure and hosting controls for systems that touch PHI

This is the area where “we’ll fix it later” becomes genuinely painful. If you build on infrastructure that isn’t designed for regulated workloads, you can absolutely make it work, but you’re often signing up for a long tail of security engineering and compliance operations work.

When it’s ok to do nothing: pretty much never.

Lowest-effort way to get started: Choose an architecture that bakes in:

• encryption (at rest and in transit)

• reliable backups and recovery

• audit logging

• least privilege access patterns

What you’ll need later: Repeatable controls with evidence: logs, reports, access controls, backup proofs, change history.

What goes wrong if you wait: Retrofitting these controls after the product is live is one of the most expensive ways to “get compliant.”

🤝 Where Aptible fits: This is what HIPAA compliant hosting is for. Aptible gives you a security and compliance-ready foundation for your most sensitive apps and data without you building and documenting every infrastructure control yourself.

2. Identity, access control, and access reviews

Access control is one of the first things buyers and auditors ask about because it’s also one of the most common ways breaches happen. The good news is you can get a long way with a few disciplined choices early.

When it’s ok to do nothing: If your team is tiny and your system footprint is truly simple. This grace period is short.

Lowest-effort way to get started:

• require MFA everywhere

• centralize identity for your most sensitive systems

• keep your “sensitive systems” list small and intentional

What you’ll need later: Regular access reviews (who has access to what, and why), strong offboarding, and least privilege across your stack.

What goes wrong if you wait: Access sprawl. Ex-employees, contractors, and random tools retain access to sensitive environments and nobody can explain it.

💡 A common path: An identity provider like Okta (or similar) for critical systems and a lightweight, repeatable access review cadence.

3. Training and HR security

Training is one of those areas where founders roll their eyes until someone asks for proof. And they will ask for proof.

When it’s ok to do nothing: If you aren’t handling PHI and you aren’t selling into regulated buyers.

Lowest-effort way to get started: Basic security awareness and HIPAA training for anyone with production access or exposure to PHI, even if it’s lightweight.

What you’ll need later: Ongoing training with tracked completion.

What goes wrong if you wait: You scramble to assemble something credible right when a customer, auditor, or investor wants evidence.

Suggested tool path: A dedicated training platform that stays up to date, like KnowBe4, is often easier than trying to reinvent training internally.

4. Documentation

This is the foundation everything else builds on. Documentation defines the scope of your compliance program: what systems you have, what data you’re protecting, and which rules apply to whom.

This is also where startups accidentally create risk by copying templates that don’t reflect reality. If you can’t follow what you wrote, the document becomes a liability.

When it’s ok to do nothing: If you don’t handle PHI and nobody’s asking you for documentation yet.

If you do handle PHI, you shouldn’t skip this. You don’t need a giant binder, but you do need something accurate.

Lowest-effort way to get started: Start with two things, kept intentionally lightweight:

1. A simple data flow document that explains:

   • where PHI comes from

   • where it lives

   • who can access it (people and vendors)

   • where it leaves your system

     
     

2. A small set of policies you’ll actually follow, such as:

   • access control

   • incident response

   • data handling and privacy

   • acceptable use

Keep them short. Keep them honest. Accuracy matters more than completeness at this stage.

What you’ll need later: As you move toward SOC 2, HIPAA audits, or HITRUST, this documentation expands into a full Information Security Management System (ISMS). That usually means:

• policies mapped to specific frameworks

• clear ownership and review cycles

• documented scope and exclusions

• evidence that policies are followed in practice

This is also when most teams involve legal counsel or a compliance advisor to make sure policies align with contracts, BAAs, and real operations.

What goes wrong if you wait: If your documentation doesn’t reflect reality, you end up with paper promises you can’t keep. That’s worse than missing documentation altogether.

In the event of an audit or incident, gaps between “what you said you do” and “what you actually do” can turn into serious liability.

💡 What this usually grows into: A mature ISMS typically includes documentation across areas like access control, incident management, vendor assurance, vulnerability management, business continuity, and more.

You don’t need all of that on day one, but starting with accurate scope and a few real policies makes everything downstream easier.

For reference, Aptible’s ISMS includes documentation for all of the following:

• Endpoint Protection

• Portable Media Security

• Mobile Device Security

• Data Protection & Privacy

• Human Resources Security

• Access Control

• Audit Logging & Monitoring

• Configuration Management

• Wireless Security

• Network Protection

• Transmission Protection

• Password Management

• Education, Training, and Awareness

• Third-Party Assurance

• Vulnerability Management

• Incident Management

• Risk Management

• Business Continuity & Disaster Recovery

• Physical & Environmental Security

• Acceptable Use Policy (AUP) for Artificial Intelligence

• Employee IT Asset Policy

5. Vendor management and BAAs

Vendor sprawl is real, and in healthcare it matters. A surprising number of compliance issues come down to “PHI ended up in a tool we can’t get a BAA for.”

When it’s ok to do nothing: If you aren’t touching PHI and you’re not selling into regulated buyers.

Lowest-effort way to get started: Maintain a simple vendor inventory and mark which vendors touch PHI. Make sure you can sign BAAs where needed.

What you’ll need later: A repeatable vendor review workflow and ongoing vendor risk management.

What goes wrong if you wait: You discover late that a critical part of your stack can’t support HIPAA requirements, and you’re forced into a rushed migration.

6. Incident response and breach readiness

Nobody wants to think about this, which is exactly why it’s worth writing down early. If you touch PHI, you need to be able to respond calmly and consistently when something goes wrong.

When it’s ok to do nothing: If you handle PHI, it’s never ok to do nothing here, but “good enough” can be very lightweight at first.

Lowest-effort way to get started: Write a short runbook:

• who gets paged

• who decides severity

• how you preserve logs and evidence

• who communicates internally and externally

What you’ll need later: Clearer responsibilities as you scale.

What goes wrong if you wait: The first incident becomes chaos, and chaos becomes liability.

7. Technical safeguards

This category covers the security controls that live outside your core infrastructure and identity system. It’s a big bucket, and it’s one that tends to grow quickly as companies mature.

The key mistake here is trying to design a perfect security stack upfront. The better approach is to turn on a few high-leverage safeguards early, then layer in more as requirements increase.

When it’s ok to do nothing: If you’re pre-launch, not handling PHI yet, and not exposing production systems to real users. This window closes quickly once you’re live with sensitive data.

Lowest-effort way to get started: Focus on safeguards that are easy to enable and hard to regret:

• enable built-in vulnerability scanning and dependency alerts in your code repositories

• make sure basic logging and alerting are turned on for production systems

• use reasonable defaults instead of custom security processes wherever possible

The goal here isn’t “enterprise-grade security.” It’s avoiding obvious blind spots.

What you’ll need later: Once you’re handling PHI or preparing for audits, this area expands fast. Most teams end up layering in controls like:

• dedicated vulnerability scanning (for applications and infrastructure)

• endpoint and device security for employee laptops

• mobile device management as headcount grows

• more structured detection, alerting, and response tooling

At later stages, companies often consolidate tooling as requirements grow and complexity increases.

What goes wrong if you wait: If you wait until an audit or customer request to think about technical safeguards, you end up bolting on tools under pressure.

That usually leads to overlapping tools, unclear ownership, and controls that technically exist but don’t meaningfully reduce risk.

A small amount of prevention early avoids a lot of cleanup later.

💡 This is a broad area by design. Vulnerability management, device security, and other technical safeguards deserve deeper treatment on their own, and most teams revisit this category multiple times as they scale. Stay tuned for a deeper dive on technical safeguards from us later.

8. Evidence, audit readiness, and SOC 2

This is the area where compliance automation tools are often the most useful. Not because they magically make you secure, but because they make it easier to run an audit process without derailing the company.

When it’s ok to do nothing: If customers aren’t asking for third-party proof and you aren’t in a procurement-heavy sales motion yet.

Lowest-effort way to get started: Don’t build a “compliance program.” Build consistent, defensible practices and keep your system footprint simple so you’re not retrofitting later.

What you’ll need later: A repeatable evidence collection process, control mapping, auditor coordination, and a way to answer security questionnaires without reinventing the wheel every time.

What goes wrong if you wait: You get blocked on a deal because you can’t provide credible proof quickly.

🤝 Where Vanta and Drata fit: For many startups, tools like Vanta and Drata are the fastest and cheapest path to a first SOC 2 because they organize the workflow and automate evidence collection across your whole company.

How this fits with Aptible: This isn’t either-or. In many cases they’re complementary:

• Vanta or Drata helps you produce SOC 2 evidence across the organization

• Aptible helps you secure and operationalize the infrastructure running your most sensitive workloads so your posture is strong where it matters most

Quick rules of thumb:

• If you’re early and you don’t touch PHI, it may be fine to do nothing for now in most areas.

• If you touch PHI, doing nothing is rarely the right answer.

• “Doing something” doesn’t mean buying every tool. It usually means making a few early choices that prevent expensive overhauls later, and then adding more formal evidence and automation when customers, auditors, and investors demand it.

• If it’s easy to automate early, go ahead and do it.

Suggested actions based on maturity level:

Real-world startup scenarios

Early stage B2B data SaaS, pre-revenue

A team of eight engineers is building an analytics product selling to small and mid-market customers. No PHI yet. They keep a lightweight baseline: MFA everywhere, a basic vendor inventory, and a simple incident runbook, and they handle occasional security questionnaires manually. Once they land their first enterprise health system that requires SOC 2, they evaluate whether a tool like Vanta or Drata will save enough time (and auditor pain) to justify the expense.

Digital health startup preparing for a first enterprise deal

A ten-person startup building connected health software wants to sell to hospitals. The platform stores PHI and needs to be HIPAA compliant. They choose Aptible for hosting so they can inherit required infrastructure and security controls and keep engineers focused on product. Early audits are satisfied using Aptible’s built-in reports and documentation, sent directly to prospects and auditors, with no compliance automation in the loop.

Growing team, multi-cloud, SOC 2, and HIPAA

A company with 30 engineers serves both healthcare and non healthcare enterprise customers. Some workloads run on Aptible, others on Azure. Customers demand both HIPAA and SOC 2. The security owner leverages Aptible to cover infrastructure controls, then implements a GRC platform for policy management, asset tracking, and evidence collection. During audits, Aptible documentation is attached as infrastructure evidence while the platform tracks broader org level tasks.

Overkill and waste

A solo founder launches a tool for freelancers that never touches sensitive data and signs a $12,000 per year contract with a compliance automation vendor “just in case.” No customer ever asks for compliance evidence. A year later they cancel and realize the tool mostly created work and anxiety rather than accelerating the business.

Actionable steps for founders and CTOs

Validate real triggers.

Before you invest heavily, confirm that compliance is truly required. A signed deal contingent on HIPAA or SOC 2 is a strong trigger. A vague “security is important” statement is not.

Understand your footprint.

Map where regulated data lives, who touches it, and which systems process it. If everything’s on a platform like Aptible, lean hard on its documentation and support.

Get access to real expertise.

This doesn’t have to be a full-time hire. A fractional CISO or experienced advisor who understands HIPAA and SOC 2 is often enough early on. A GRC tool is not a replacement for this.

Map your requirements.

If your needs are mostly infrastructure, managed hosting will cover a lot. If you also need org wide policy management, vendor reviews, and risk registers, consider a GRC platform on top.

Avoid overbuying.

A lot of startups regret buying platforms too early or paying for bundles they don’t use. Push vendors for trials, talk to peers, and be honest about how often you’ll log in.

Plan for growth.

Choose an approach that can scale with you as you move into new markets, take on larger customers, and add more teams.

Leverage vendor support.

This is one of the most underrated levers. Aptible and some compliance automation providers offer real human support and playbooks. Use them. A single call with someone experienced can save you weeks of flailing.

Common mistakes

• Buying a platform early to look mature then letting it sit as shelfware

• Underestimating the up-front work required, even with automation

• Over relying on dashboards and assuming auditors will accept them at face value

• Failing to involve product, sales, and engineering so compliance work doesn’t break the user experience

• Ignoring the controls your infrastructure provider already gives you and rebuilding them manually

• Treating compliance as a one-time launch project instead of an ongoing obligation

TL;DR and next steps

Compliance will touch every serious digital health startup that handles sensitive data or sells into regulated and enterprise markets. The timing and shape of that investment is up to you.

In short:

• If you don’t handle PHI and nobody is asking for proof, it can be fine to do nothing for now, but keep an eye on where your data is going.

• If you handle PHI, do the baseline work early: map your data flows, keep PHI out of the wrong tools, and make infrastructure choices you won’t regret.

• Tools like Vanta and Drata can be a cost-effective way to get your first SOC 2 when customers start demanding third-party proof.

• Aptible is designed to secure and operationalize the infrastructure running your most sensitive workloads, so you don’t have to build compliance-grade infrastructure controls from scratch.

• As audits become recurring and your org grows, you’ll eventually want a real internal owner (compliance lead or empowered CISO). Tools help, but they don’t replace ownership.

If you’re a digital health founder, your goal isn’t to become a compliance expert. Your goal is to make deliberate, stage-appropriate investments that keep your customers safe, your auditors satisfied, and your company focused on building something valuable.

If you want to see how Aptible can accelerate your path to HIPAA readiness and give you a stronger infrastructure story with minimal headcount, our documentation and startup program are a good place to start.