Section 6.10 - ROI Worksheet
DOC-REF: FRC-ROI-001
Is FedRAMP Worth It? ROI Worksheet
Every FedRAMP cost guide tells you what authorization costs. None help you model whether the investment pays off. The federal IT market exceeds $100B annually. The question is whether your specific revenue opportunity justifies the investment.
Federal IT Spending (2026)
$100B+
growing 5-8% annually
FedRAMP Marketplace
300+
authorized cloud products
Authorization Leverage
Achieve Once
reuse across all agencies
Section A - ROI Worksheet
FedRAMP ROI Calculator
Enter your authorization cost and projected federal revenue by year. The worksheet calculates payback period, 3- and 5-year ROI.
Include documentation, 3PAO, remediation, year-1 ConMon
Ongoing continuous monitoring after year 1
Expected new federal contract revenue in year 1 post-ATO
Projected year 2 as pipeline converts
Projected year 3 at steady state
Percentage premium federal customers pay vs commercial (typically 10-20%)
Section B - Estimated Return
3-Year ROI
71%
5-Year ROI
221%
Payback Period
26 months
Annual Break-Even
$583k
federal revenue/yr
Achieve once, reuse many. FedRAMP authorization applies across all federal agencies. Each additional agency contract has near-zero incremental compliance cost.
Section C - Disqualification Tests
When NOT to pursue FedRAMP
FedRAMP is a significant investment. Not every CSP should pursue it. Consider deferring if any of the following apply.
- C.1Your projected annual federal revenue is under $500k/year within 3 years of authorization
- C.2You have no agency sponsor relationships and no active federal pipeline
- C.3Your product is not mature enough for enterprise government deployment
- C.4Your engineering team cannot absorb the 12-18 month distraction
- C.5You serve only state/local/education markets (consider GovRAMP instead)
- C.6FedRAMP 20x at $100k-$300k is 6 months away and you can wait
Next step
Estimate your authorization cost
Use the cost worksheet to get a detailed breakdown, then bring those numbers back here to model ROI.