Different Cyber Risks Facing Startups and Ways to Protect your Business
Barely a month goes by without news of yet another massive data breach. As per the Risk-based Security Research published in the 2019 Bi-annual Data Breach Review, the first quarter of 2019 saw over 3, 800 breaches happen, exposing a staggering 4.1 billion compromised records.
From this data, it’s clear that both the severity and pace of data breaches are on the rise. While it’s the big names that dominate the headlines when it comes to cyber threats, startups, and small businesses are the prime targets for cybercriminals. This is because startup owners are solely focused on meeting with investors and clients, finding product-market fit, and building exceptional teams. They forget about one of the most crucial aspects of a business, cybersecurity.
What startup owners don’t know is that data breaches come at a very high cost, both financially and reputation-wise. In fact, cyber threats have been listed as the 4th and 5th most critical risks that business owners across the world are facing. This is according to the World Economic Forum’s 2019 Global Risk Report.
Cybersecurity ought to be on top of your business plan and should be executed with the same vigor as recruiting your first employees. Here are some of the cyber risks all startups must be aware of and ways to protect their business.
Cyber Risks Faced by Startups
Startups, just like any other kind of business, face different cyber risks. Let’s look at some of them in detail.
Internet of Things (IoT)
Today, almost everything is a smart or connected device with Wi-Fi, internal storage, Bluetooth, and generally, a connection to your private network. The thing is these devices are quickly penetrating into the average workplace, ranging from security cameras to connected coffee machines.
If not checked IoT devices could bring serious cybersecurity risks to your business, including data breaches or DDoS attacks. As a startup owner, you need to be aware of these new and emerging risks that IoT devices bring to your day-to-day business operations. They are quickly becoming the underrated weak-point in what may seem like a robust security system.
With the increase in the number of data breaches happening each year, startups will have to take the security of their documents, user information, and digital data very seriously.
Data breaches are security incidents where data/information is accessed illegally. Today’s startups tend to embrace new technologies with ease, including apps, digital working environments, and connected devices, which makes them particularly vulnerable to data breaches. This is made worse if oversight, policies, and procedures are not robust enough to ensure every communication channel or device’s security.
As the name suggests, ransomware attacks encrypt or lockdown data by infecting the device or entire server, and rendering it useless/inaccessible to the owner until a ransom is paid. In most cases, the ransom is asked in cryptocurrencies such as bitcoin as it’s much harder to track than traditional cash or online transactions.
There is a good reason why phishing attacks still find a spot in the top cyber risks each year: they still work. 2020, for instance, saw a rise in the number of phishing attacks due to the shift from office to work-from-home in a bid to combat the spread of the coronavirus.
Phishing is a form of socially engineered attack where the user is tricked into sharing their login credentials. A classic phishing tactic is where the user receives an email alleging to be from their bank, Facebook, IT, or any other site that the victim usually uses.
Phishing emails usually include a web link or attachment and some urgent instruction telling you to click now or something serious will happen. Clicking the link usually takes you to a fake version of a website where you are lured into entering your username and password. Before you know it, you’ll have handed over the access of your documents, accounts, or vital internal data to an unscrupulous third-party.
Your system is as secure as the people you have employed. Human error means a lack of action or unintentional actions by employees or users in a cybersecurity environment that can cause the spread or occurrence of a security breach.
This includes many actions – from failing to change the password or not using a strong password to downloading a malware-infected attachment. According to statistics, 25% of employees login into all their accounts using the same password. Only 40% of employees use devices that are correctly monitored. This shows that employees will go to great lengths to bypass even the strictest company security protocols for convenience’s sake. Mitigating against convenience is, therefore, a constant struggle.
How to Protect your Startup from CyberThreats
Let’s now look at the different ways you can protect your new business from the threats mentioned above.
Encrypt Sensitive Data
It is vital to have an end to end encryption of your database, especially if your business keeps any kind of customer information. Storing customer data “in the open”, whether it’s regulated data such as credit card information or just personal data like shipping addresses is not a good idea. Have strong encryption in both your logistics and production systems from the word go.
Risk assessment refers to a thorough audit of your system. It is important to evaluate risks and vulnerabilities in your system to find potential entry points. A risk assessment will help you know where exactly your business is most susceptible and help you patch these defects and protect your business data.
Make Security A Part of your Startup Culture
The weakest link in your security system could be your employees. A significant percentage of attacks begin with a spear-phishing email meant to infect your device with malware. As the owner of a startup, it is essential to set the tone for how your staff should respond to suspicious phone calls and emails. Let it be obvious that you take security very seriously and that your team can trust you to handle any reports of possible threats seriously.
Outsource Cybersecurity Services
By outsourcing your cybersecurity services, you’ll be allowing your startup to have the expertise of devoted cybersecurity professionals. This means your small business will be getting the level of expertise that cannot be afforded internally. Outsourcing your cybersecurity services to the experts is the best way to ensure security for your startup.
Your employees need to be trained on cybersecurity best practices to protect themselves and the company against online adversaries. Regular employee training ensures the weakest links in your company’s cybersecurity are strengthened. Make sure your workers are aware of the different threats they are exposed to, how these threats can present themselves, and the steps to take in the event that a threat is detected.
Use a VPN
A VPN (a Virtual Private Network) makes a personal connection from a public network, ensuring that you have online privacy and anonymity. Therefore, it will pay off if you were to use a VPN router to secure all connections and ensure you are defended against malware, DDoS attacks, and other online threats.
Enable Multifactor Authentication
MFA offers a second line of defense on your device apart from the usual password request. When you enable MFA, your device will demand additional authentication like proof of possession of the cell phone by sending a text containing a secret code. Multifactor authentication blocks phishing successfully as it makes the user’s password insufficient for the hacker to gain access to the user’s account.
Unlike before, MFA is now available as an alternative in most modern software such as Microsoft Office 365, Google Docs, and Slack. So, ensure you enable MFA throughout your organization.
Ensure your Systems are Up to Date
Cyberthreats are constantly evolving, and cybercriminals are always inventing newer, more sophisticated tactics to break into your systems. Therefore, using old, outdated software puts your business at a higher risk. Updating your operating systems and software will help you keep the bad guys at bay. Always ensure you are running on the most recent software versions and have activated the latest security patches.
As a startup owner, it’s good to know that data breaches can have dire consequences on your new business. A report on the 2019 Data Breach in the US, conducted by the Ponemon Institute/IBM Security, revealed the average cost of a single data breach to be $3.92 million, with 67% of the total cost being realized within the first twelve months of the violation.
For many businesses across all industries, the highest cost comes from the loss of clients after a breach because they no longer trust the company with their personal data. Going by these figures, it is clear that cyber risks do not care whether you are a startup or an established enterprise. Any business, small or big, can fall victim to these cyber risks that keep growing by the day. As a startup owner, it’s time you took cybersecurity very seriously. Get to know the different cyber threats that your startup is prone to and the best ways to stay protected.