“There is a reason why the world of internet is popularly called the ‘Virtual World.’ Just like the physical world, there are the good and the bad guys online too.”

Digital technology has manifested itself into all aspects of 21st century business operations. Both service providers and end-users are online. Most importantly, communication and financial transactions which are at the core of any business, take place online these days. While this has taken efficiency and ease of operations to an altogether new level, it has also created opportunities for cyber criminals to breach into an organization and cause potentially irreparable losses. When we talk of start-ups and SMEs, digital presence becomes even more crucial for them because more often than not, they have limited hands to deal with every aspect of business. Digital technology enables them to multi-task as well as automates some of their operations. 

SMEs are more vulnerable

The common misconception cultivated by start-ups and SMEs is, “we are not the rich guys or the big brands with Big Data, why would anyone come after us?”

The truth be told: “Almost 60%[1] of the SME victims of cyber-attacks, shut shop within 6 months of the incident.”

Just like the real-world criminals, cyber criminals also look for easy prey and targets that are sitting ducks compared to the fortified large-scale enterprises. Another major theory that must be debunked is that cyber-attacks are performed by a geek operating out of a basement and on the hunt for high-value targets. In reality, majority of the cyber attacks are carried out by automated software programs and scripts that keep searching for vulnerable computers, websites, login ids and servers, irrespective of the size and nature of the business organization. 

There are other major reasons why SMEs are the preferred targets for such malicious activities.

No or little investment in cyber-security

Hackers know that small businesses have negligible budgets to spend on cyber-security tools. Hence, they become a soft target for the cyber criminals.

SMEs as stepping stones to bigger targets

On its own, a small firm might not be a lucrative target, but such a firm can be an unwitting gateway to a much larger organization. Large businesses generally have firewalls and other defence mechanisms in place that are not easy to bypass, but have numerous smaller companies connected to them as vendors. By compromising the SME systems, criminals are able to gain easy access to the internal systems of the large enterprises.

SMEs are more likely to pay Ransom

For a small company, the loss of data stored in one single computer itself might be fatal. Hence, they are more prone to pay ransom after being affected by ransomware attacks and retrieve their data. 

Internet of Things vulnerability

Internet of Things technology makes it more convenient for SMEs to automate some of their tasks and perform other tasks with more ease. However, this ‘technology of future’ has also created a lot of new entry points for the hackers. All that they need to do is to breach into one and gain access to all other networked devices.

The inside job

In a large number of cases, the breaches turn out to be the handiwork of insiders and that’s a vulnerability suffered by organizations across the spectrum. Employees in smaller organizations often get access to more crucial data and authority logins. In such scenarios, a rogue employee can cause potentially debilitating damages.

Cloud safety risks

Cloud technology has been disruptive as it gives great flexibility, scalability as well as economic benefits to the SMEs. However, there are a lot of grey areas regarding cloud security. Despite the service providers offering enterprise level security measures, it is the potential loose ends and vulnerability in cloud integration that could lead to security breaches. It is also widely assumed by experts that just because cloud systems haven’t been breached, it can’t be ruled out that they can be breached.

In conclusion

It is common for startups or SMEs to overlook cyber-security elements due to their focus on sales and operations and lack of resources to invest in systems and IT teams. However, it has to be given due importance as cyber-security is an essential requirement and not an avoidable overhead. The proliferation of digital technology has also led to there being some really good anti-malware and software systems that are affordable and easy to integrate. SMEs and start-ups should consult third-party cyber-security experts and avail customized solutions catering to their needs and budgets. 

“Prevention is always better than cure”