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Delivering a unique value proposition, researching markets, and attracting much-needed starting capital requires all hands on deck for any hopeful startup. Data security, privacy protection, and incident response plans that cover what to do if and when your cyber defenses are compromised don’t seem like immediate concerns worth devoting resources to during such times.
Yet startups that neglect to cultivate their cybersecurity posture from the outset risk reputation damage, loss of investor trust, and financial setbacks that even more robust companies cannot recover from. Here are the five crucial cyber threats startups need to be aware of and the strategies they should employ to mitigate the dangers.
Phishing Attacks
Phishing is the most prevalent and potentially the most dangerous cyberattack affecting startups. It has evolved over the years from indiscriminate, poorly written emails that were easy to spot – to sophisticated steps that are often part of grander hacking campaigns. Either alone or as part of more advanced efforts, phishing is responsible for the vast majority of data breaches.
Since startups attract attention by actively engaging with potential investors and the public, it’s not hard to collect data on crucial employees, draft convincing emails that look like a trusted source sent them, and ask the recipient to enter sensitive information on an external website or download malware. Business email compromise (BEC) is even more insidious since it relies on stolen or spoofed email addresses to give the message extra legitimacy, resulting in potentially massive financial losses for the company.
Awareness and employee training are the best methods to combat phishing attacks. Spotting the telltale signs and habitually bringing suspicious emails to their supposed senders’ attention will prove invaluable to protecting your startup from data breaches.
Vulnerable Passwords
Many startups operate entirely within the digital realm, meaning they rely heavily on other companies and their products, each with a corresponding account requirement. Credentials quickly pile on, and we, as humans, aren’t good at keeping track of or securing our passwords.
Hackers count on this. In fact, a well-known operation is to acquire databases of previously breached accounts and use these username and password combos to try and access other common accounts. Before you know it, one hacked password can expose several accounts with the same password and all the connected data instrumental to your startup’s operation.
Implementing a trusted business password manager is the most straightforward and effective course of action. These tools can generate long and unique passwords that comply with stringent safety standards and replace old ones for as many users and accounts and as often as needed. Password managers also allow for secure credential sharing and can store other sensitive information inside encrypted vaults.
Malware
Malware is the collective term for a wide range of malicious software that can infect your company’s systems and cause damage in different ways. For example, cryptojackers will repurpose your system resources to mine cryptocurrency behind your back. Keyloggers save and send keystroke histories to their creators, potentially uncovering login credentials or company secrets.
Ransomware has become rampant. It encrypts system-critical files and makes your devices unusable, which its creators will only reverse if you pay the fee. On the one hand, ransomware is particularly harmful for startups since it can grind daily operations to a halt. On the other, paying up may put you in a financial bind that’s impossible to get out of, especially during the early stages.
Small startups may not have the IT staff to ensure operating systems, anti-malware protection, and frequently used programs are up to date on all company devices. Since this is the most proactive step towards identifying and mitigating malware, you may need to hire someone or consider an endpoint management solution.
Insider Threats
The hiring process at startups can be hectic, especially if you’re experiencing a growth spurt and rush new arrivals through the hiring process to meet increased demand. It’s also not uncommon for employees to leave a startup after disagreements or changes in vision. Both scenarios may introduce ill-intentioned individuals with the motivation and resources needed to do much damage.
Malicious insiders may do anything from exposing company secrets through manipulating data and accounts for their financial gain to creating backdoors they or their associates can use to access company systems at a later time. For example, a duo of disgruntled Tesla employees leaked the personal information of more than 75,000 employees to a German newspaper in 2023. The newspaper in question chose not to publish the data per the GDPR. However, a less scrupulous entity could have done a lot of harm with this information.
Preventing malicious insider activity is tricky since their regular duties may legitimately involve them with vulnerable data. However, regulating data access will limit the scope of such attacks and reduce detection time.
Using password managers like NordPass to provide everyone with unique logins for each account is a good start, but you should augment them with an access management system as well. This ensures you can implement Zero Trust and logging policies. The former limits employee access to the scope of their work, while the latter provides a well-documented activity trail indispensable for pinpointing incidents and identifying associated account activity.
Cloud & Third-Party Vendor Risks
The shift toward always-online service-based business models introduces vulnerabilities other than account sprawl. Lack of expertise could cause startups to misconfigure cloud storage, leaving data that should have the highest protection vulnerable to viewing and downloading by people with low clearance levels. There’s also the fact that each third-party vendor you work with represents a potential security risk, as you have no say in the cybersecurity measures they use.
The solution to both problems is to thoroughly vet cloud storage providers and other third-party vendors, ensuring that their features and security precautions meet your current and future standards. You’ll also want to make regular physical backups of your most important data and keep them off-site so you can get up and running fast, whether something befalls the startup itself or your storage provider.
Conclusion
The belief that hackers don’t concern themselves with startups and other small businesses has already led far too many of them to close up shop before they’ve even had the chance to prove their worth. We hope acting on the information presented here will prevent your startup from becoming part of the grim statistics.
