Understanding FedRAMP
The Federal Risk and Authorization Management Program (FedRAMP) is a standardized security assessment and authorization program that governs how cloud products and services are used by federal agencies. FedRAMP ensures that cloud providers meet strict security and compliance standards, reducing risk across government IT systems.
While FedRAMP Authorization opens the door to federal contracts, the process is rigorous, time-consuming, and costly. Some companies get too excited about one or two agencies expressing interest in their solution. Companies must weigh the benefits against the investment required to achieve and maintain compliance.
Key Considerations Before Pursuing FedRAMP
Assess Government Market Demand for Your Product
- Have you received consistent interest from government agencies, or is this a single inquiry?
- Are there federal agencies already struggling with the problem your product solves?
- Are competitors or similar solutions already selling to the government, and if so, are they FedRAMP Authorized?
Understanding the demand for your product in the federal market is critical before investing in FedRAMP. A strong pipeline of interested agencies can justify the effort and expense.
Evaluate Your Federal Sales Strategy
- Do you have internal resources or a go-to-market strategy for selling to the government?
- Have you identified contract vehicles and procurement pathways (e.g., GSA Schedule, direct procurement, or partnerships with prime contractors)?
- Will your company be able to navigate the complex federal procurement cycle?
It is important to evaluate your product readiness alongside your go-to-market readiness before committing to the FedRAMP process.
Understand the Costs and Timeline
FedRAMP Authorization requires a significant investment, including:
- Time: Up to 24+ months for most companies to achieve full authorization.
- Cost: Up to $2M+ in upfront expenses, including security assessments, remediation efforts, and documentation.
- Continuous Monitoring: Ongoing costs for security maintenance, annual audits, and compliance updates.
Can your company absorb these costs while maintaining commercial growth?
Identify a Sponsoring Agency or Use the JAB Pathway
There are two main paths to FedRAMP Authorization:
- Agency Sponsorship: A specific government agency agrees to work with you through the process and eventually use your product.
- Joint Authorization Board (JAB) Authorization: A FedRAMP governing body (consisting of GSA, DoD, and DHS) provides a provisional authorization for use across multiple agencies.
Agency sponsorship sounds like a direct route, however, companies often find that getting an agency to sponsor and champion your solution is very challenging.
Determine Your Security Posture and Readiness
There are two main paths to FedRAMP Authorization:
- Does your product currently meet FedRAMP’s stringent security controls?
- Are you using a cloud service provider (AWS, Azure, Google Cloud) with FedRAMP-approved environments?
- Do you have the internal cybersecurity expertise or need external support?
Many SaaS companies undergo a gap assessment to determine what changes are needed before embarking on full FedRAMP Authorization. Typical gap assessments are very costly, and they often do not provide a comprehensive picture of what you need in order to make a well-informed decision to pursue FedRAMP.
