Launching a startup may be a daunting task. There are numerous things you need to take care of, such as securing the right funds, hiring top-notch talent, creating a product that sells, targeting the right customers, and developing a solid marketing campaign. Not to mention that you need to constantly keep pace with the market changes and try to rise above your competitors.

However, focused on these aspects of their growth, many startups fail to take an immensely important factor into consideration and that’s the safety of their company. Namely, with the rapid rise of the IT landscape, the risks of digital threats are also growing. This form of attacks has become extremely sophisticated and the chances are that they can completely ruin your company before it even comes close to generating profits.

With that in mind, here are a few reasons why cybersecurity is critical to every startup. 

More than Half of Companies Hacked are Small Businesses

What makes startups easy targets is the fact that they believe they cannot be hacked. The KMPG report shows that 51% of small businesses think no one would hack them, while only 33% of them feel completely prepared for a cybersecurity breach.

Unfortunately, cybercriminals love hacking young companies. Some recent reports claim that 70% of the companies hacked were small and medium-sized businesses.

Every business is a treasure trove of information for hackers. Namely, many startups don’t properly secure their customer and employee data, such as credit card details. By not taking adequate precautionary measures, you’re actually putting your customers at risk of becoming the victims of a financial fraud.

So, if your company gets attacked, you may end up in court. For example, the Australian government introduced the Mandatory Data Breach Notification Law that requires companies with a turnover of over AU$3 million a year to tell their customers if their personal data is compromised by a cyber breach.

The Number of Small Business Attacks is on the Rise

In today’s hyperconnected world, we’ve moved almost every segment of our businesses, from managing finances to storing files, to the digital marketing landscape. We use mobile apps and web platforms to deliver products and services, as well as cloud to save and transmit massive data easily. And, as the enterprise security has become incredibly complex, it is getting more vulnerable to hacks, as well.

To protect your organization, you need to invest more in your company’s cyber risk management. This includes:

• Cyber risk evaluation, or assessing the actual level of risk.
• Cyber risk mitigation, which means building and implementing a cybersecurity strategy. You need to invest in the advanced malware protection, endpoint security, wireless security, encryption, log management, network traffic visibility, BYOD security, and vulnerability management.
• Cyber insurance, or choosing the right risk transfer option.

Security Threats Come from Within

If you think that hacking is something that happens outside your company, you’re wrong. The harsh truth is that a lot of cyberattacks have a root cause in some form of employee negligence. 80% of them, to be precise.

To prevent this, you should provide your employees with the adequate training programs, where they can learn how to safeguard the company’s sensitive information. They should be able to tell phishing emails from authentic ones. Teach them not to use unprotected networks to log in to the company’s server, install any unsigned third-party apps, or plug in any flash drives they’re not sure where they come from.

Understanding the Consequences

Even though the ramifications of suffering a hack vary, they essentially fall into the same categories.

The first one is, of course, a financial loss. The financial losses caused by a cyber breach can be severe and extremely difficult to recover from. Sometimes, these incidents aren’t even covered by the company’s insurance plan.

Another immensely important problem companies face is the loss of reputation. Namely, the above mentioned KMPG report shows that 89% of the small businesses that have experienced a cyberattack confirmed that it affected their reputation. Irrespective of size, all victimized companies will suffer an immense brand damage that may prevent them from both attracting new and retaining loyal ones.

The Implementation of IoT is important, but It needs to be Done Properly

Parallel with the ever-growing IT sector, the danger of cybersecurity breaches will only increase in the future. However, by building a solid cybersecurity plan and taking all reasonable precautions, you will manage to implement the cyber risk transfer and mitigate the risks of getting hacked successfully.