The challenges facing startups are immense, and the more you dive into them the more solutions you find yourself needing. Sadly, the failure rate of startups was around 90% in 2019, with 50% of that figure not making it beyond their fifth year.

Obstacles like competitive markets, cash flow and poor marketing are just some of the bumps along the path to success. Another emerging area of concern for startups is cybersecurity. This area of the tech industry is now a must-have for businesses, big and small, and we’re taking a look at why startups must get their cybersecurity right.

What cybersecurity protects

Modern businesses can be holding more valuable information and data than ever before. With so much information circulating throughout your business, hackers can look to find a way through your security network to harvest that data. A good cybersecurity system will protect sensitive business and consumer data that hackers would look to sell to the highest bidder.

Companies also own plenty of intellectual property which is often the key to their success. Having this stolen from your startup could see you falling behind your competitors before you even get going in the race. This is even more worrying in cases of corporate espionage, where business competitors deliberately look to gain access to their competitor’s data.

Cybersecurity protects any personally identifiable information your company may have, whether that be information about you, your staff or your customers. Protected health information and government or industry information systems are also kept out of the hands of hackers with a good cybersecurity system.

Fines and costs of data breaches

While cybersecurity might initially feel like something you should have but not something you need to have, this is far from the case. In truth, there is a price to pay for having inadequate cybersecurity. Data breaches can result in large fines that could financially hamstring any startup to the point where it may struggle to continue.

The financial implications are potentially huge, thanks in part to the EU’s General Data Protection Regulation (GDPR). The maximum standard fines dished out for breaching GDPR rules are close to £17 million but they can be much higher. For instance, Amazon was fined £628 million in 2021 for a GDPR breach due to bending the rules regarding cookies a little too much.

Financially, data breaches can be crippling but that’s not the only punishment businesses can endure when their cybersecurity has been penetrated. There is also a loss of confidence from consumers, which can be just as large of a penalty, especially for businesses yet to establish themselves. Startups giving customers a reason to doubt them can see them ignored or forced to enter a positive PR campaign to get people back onside.

Threats are advancing and adapting

Not only is the threat of cybercrime an ever-present one but it’s also adapting all of the time. Staying on top of the latest threats is the only way to minimise the risk of data breaches, though there are the added costs involved to consider.

The way we work has changed in recent years and this has given rise to cybercrime threats that were previously unconsidered. For instance, the simple act of video conferencing increases the risk of cyberattacks through the hijacking of the meetings or gaining access to sensitive meeting recordings.

There is also the fact that we are spending more time online than ever thanks to working from home and less time spent going into the office. Our global connectivity is ever-increasing through the rise of cloud services and Internet of Things devices.

A 2020 report discovered that cybercrime rates had doubled in just five years. These advancing threats require improved defences. No longer are simple firewalls and antivirus software up to the job. Instead, we need to invest in robust cybersecurity systems that cover all of the bases.

How to protect your business

While it is a worry that cybersecurity is such a must-have in today’s business world, all hope is not lost. From simple jobs to full-scale data protection campaigns, organisations and startups do have some defence against hackers.

There are simple measures like ensuring your web applications are up to date to give you the most current protection against threats. Or you could invest in something like ethical hacking, which involves a cybersecurity expert identifying weaknesses in your security system before real hackers find a way in.

There are also two main types of cybersecurity that startups can consider to protect themselves from hackers; inherent risk and residual risks. Let’s look a little closer at how inherent and residual risks can be reduced.

Inherent risks

Inherent risks are the kinks in your cybersecurity defences that need ironing out from the get-go. They are what a security expert will try to prevent if they were to do an initial analysis of your systems.

Inherent risks are, in a nutshell, vulnerabilities within an organisation before security measures are implemented. Overlooking them can leave your company at risk of a data breach, which is especially likely in startups as your company may not yet be running like a well-oiled machine.

Here are the types of inherent risks worth investigating:

  • Data loss
  • Weak passwords
  • Poor data handling
  • Insider threats
  • Malware
  • Third-party inherent risks
  • Phishing scams

Data loss

This can include anything from accidental deletion of files to laptops being stolen or hard drives suddenly wearing out. Without protection, it can happen time and time again. The most simple solution to this problem is to ensure data is constantly backed up either in a physical backup location or using cloud storage.

Weak passwords

You may be surprised by how important a password can be to preventing a data breach.  While there is no 100% guaranteed way to stay safe, avoiding things like default passwords goes a long way to putting up a barrier.

Simple passwords, including ones without numbers, uppercase letters and special characters can be easily hacked through credential stuffing. Password manager systems and two-step logins are simple but effective tools to minimise hacking risks.

Poor data handling

Many startups are less likely to have robust cybersecurity protocols in place from the beginning when compared to larger, established organisations. This can result in a risk of poor data handling, where employees violate data protection policies that could result in lawsuits.

For instance, an employee accessing information not relevant to their role, like bank statements. This can also encompass working from home issues like a lack of a secure network without the use of an adequate VPN.

Insider threats

It’s not nice to think of people you employ as potential threats but sometimes it does happen, though commonly this is not a malicious act. Worryingly, 25% of data breaches were caused by insider threats. It could be as simple as someone downloading some software onto a work device for their personal use.

That unauthorised software could cause a data breach so it’s wise to educate your employees about using work devices safely. Putting company policies in place that prevent such downloads is a great way to protect your business against insider threats.

Malware

Work devices can be infected with malware like ransomware which is a type of malicious software designed to block access to a computer system until a sum of money is paid. It can result in a loss of data or a disruption of business operations due to the nature of the ransom.

The surest way to protect from various types of malware is to install anti-virus software on all of your devices. This should extend to any personal devices your employees might use when working remotely. Companies opting against installing anti-virus open themselves up to attacks from both their software and hardware.

Third-party inherent risks

Your business may be vulnerable to third-party users such as service providers that have access to your network. The information at risk through unauthorised access of data includes social security numbers, credit card details, trade secrets and financial records.

Phishing scams

Lots of us are internet savvy these days and know clicking on random links can be dangerous. But it only takes one link with malicious content lying behind it to breach your entire network, giving hackers a way in.

Like many inherent risks, phishing scams can be easily avoided by educating employees to avoid clicking on things they shouldn’t, like pop-ups and random links. Additionally, installing firewalls and protective add-ons can catch most of these phishing scams before they even see the light of day.

Residual risks

Residual risks are the security risks in your system calculated after a cybersecurity expert has put their protections in place. This calculation includes every possible gap that could affect a system or data.

Threats that remain following a system sweep will always be present. Your best defence against them is to set an acceptable threshold and implement programmes and solutions that reduce the risks to below that marker.

Relying on cybersecurity professionals

Working with a cybersecurity professional to maintain your network’s integrity is becoming more and more essential. With the risks of huge fines and debilitating downtime being the cost of a data breach, startups must stay ahead of the game at all times.

Established businesses might be able to take the hit but every penny counts towards getting your business off the ground. Making room in your tight budget to establish robust defences against hackers might seem like throwing good money away until the worst happens and a data breach occurs.

Dakota Murphey

Dakota Murphey

About your author

Dakota Murphey is a freelance writer from the UK who specialises in: Digital Trends, Business, Marketing, PR & Branding, Cybersecurity, Entrepreneurial Skills and Company Growth. 

Find out more about Dakota here:

Twitter | LinkedIn

 

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