When it comes to companies that are in the startup phase, protecting data can be a big challenge. This is because everyone who is part of the company may not understand the importance of cyber security or the type of data that needs to be protected at all costs. There is also limited availability of resources, and the owners prioritize other areas such as marketing, inventory, and supply chain management. Cyber criminals know this, and often target startups and small businesses due to this reason.
Many startups don’t even have a cybersecurity policy until they suffer from a data breach, and are clueless about the steps to take forward. When that happens, they can suffer from severe financial and reputational damages and may not flourish as a business. Let’s look at 7 reasons why startups and small businesses need to pay attention to cyber security and take it seriously right from the start.
- Startups and Small BusinessesHave Lots of Data to Protect
Though small businesses and startups have lesser finances, they often collect large volumes of data. Many cyber criminals know this, and view this data as a valuable resource to access and steal personal information and intellectual property.
This data can be misused by cyber criminals to carry out identity fraud with Personally Identifiable Information (PII), carry out phishing attacks against customers by impersonating your company, trading or selling financial or personal data on the dark web to other cyber criminals, carrying out online transactions, or selling this information to your competitors. These are some of the reasons why it is important for small businesses to protect their data.
2. Cybercriminals Attack you to Target Bigger Companies you are Affiliated with
Many times, cybercriminals attack small companies as a way to reach bigger organizations that they are affiliated with. For instance, in 2013, attackers stole data of Target by breaking into the systems of refrigeration, HVA, air conditioning, and heating subcontractor. This led to a breach of stolen data of 40 million customers.
3. Small Businesses have Lesser Resources to Spend on Cyber Security
To set up their businesses, startups initially spend on labor and marketing costs, with cybersecurity as the last thing on their mind. Their focus in mainly on starting the new business, setting up processes, and taking over the market. With limited capital, they also find it hard to employ cyber security personnel. Even by investing in anti-malware tools, they often don’t have the capability to keep a check on everything at all times. This makes them an easy target for cyber criminals.
4. Small Businesses Need to Follow Government and Industry Regulations
Small businesses need to comply with industry regulations and those set up by the government. Some of these include the Payment Card Industry Data Security Standards (PCI DSS) requirements that define set of rules to process and accept online payments, General Data Protection Regulation (GDPR), ISO 27001, and others. Failure to comply with applicable standards can have huge implications on the business.
5. Small Businesses Need to Protect their Brand Name and Reputation
If a cyberattack results in the criminals succeeding to attack your IT infrastructure, website, or devices and steal the data, your customers will be hesitant to do business with you. In their eyes, you will be a liability and they will be more likely to do business with your competitors instead of risking their data. According to Sectigo’s 2021 Website Security and Threats Report,28% of small and medium business that suffered from data breach incidents had to face ‘severe’ to ‘very severe’ consequences. These included website downtime, reputational loss, and loss of customers and intellectual property.
6. Data Breaches can be Caused by Insider Threats
While we mostly think of threats as external, it is not uncommon for people from inside the company to be a cause of data breaches. These can be both intentional and unintentional. It could be an employee making a mistake while a disgruntled one making a mistake on purpose. However, both types of employees pose serious threats to the organization. Hence, access control is very important for small businesses.
7. Startups Intending to Move to the Cloud Require Cyber Security Planning
Moving the business to cloud can be resourceful for startups and small businesses. However, it comes with its own set of risks. Trying to do this without implementing appropriate IT support and cyber security measures could in turn mean that you are directly handing over your data to cyber criminals. According to 2020 Cost of Data Breach Report by IBM, 19 percent of malicious data breaches were a result of cloud misconfiguration, which increased the average data breach costs by 14 percent.
Cybersecurity is often overlooked by startups and small businesses, but failure to adopt an adequate security policy can affect everything for them. From the ability to safeguard customer data and intellectual property to comply with industry standards, it is imperative to keep adequate cybersecurity measures in place.