Smaller businesses and startups are the targets of over 40% of cyberattacks, with more complex tactics and techniques used to bypass security measures. However, far too many SMEs and startups lack the necessary cybersecurity protections to defend themselves and their clients.
A cyberattack can cause several issues, including operational disruption, damage to infrastructure, and the potential for unauthorized access to sensitive data. In some cases, small-to-medium-sized businesses fail to recover from such an incident due to a lack of budget and resources. At the same time, it may also prove difficult to repair any reputational damage.
Unfortunately, many of the businesses that are most vulnerable do not have the required processes in place to mitigate the threat of a cyberattack. This article will discuss common cyberattacks on SMBs and the most affected industries. We’ll also provide tips for developing a proactive cybersecurity strategy in 2023.
The Rising Cost of Cybercrime
Small businesses and startups must constantly adapt to new working practices and changing technologies. The global Covid-19 pandemic was a clear example, with businesses experiencing a significant shift towards remote work. Today, working from home has become the norm in some companies, while others have adopted hybrid working models. However, this remote working environment also presents additional risks in terms of cybercrime.
The number of external devices that now need to connect to a cloud network presents an opportunity for cybercriminals, meaning increased investment is required to protect digital assets and reduce an organization’s attack surface.
It is reported that cybercrime has increased by 600% since the pandemic. This figure is obviously alarming, as the average cost of a ransomware attack is around $1.85m. And projections show that cybercrime could cost companies around $10.5 trillion worldwide by 2025, up from $3trn in 2015, representing annual growth of 15%.
Common Cyberattacks on SMEs and Targeted Industries
It is important to understand what attacks may commonly target an SME or startup so that a strategy can be put in place that prioritizes the most urgent threats.
According to the Ponemon Institute’s State of Cybersecurity Report, common cyberattacks include:
- Phishing and social engineering scams (57%)
- Stolen and compromised devices (33%)
- Theft of personal credentials (30%)
Studies show that certain industries experience specific attacks at higher frequencies than others. The reason for this could be how an industry typically interacts with customers, takes payments, or the software deployed.
For example, banks and financial institutions contain information that is extremely valuable to criminals, such as credit card and bank account details and a client’s data. Meanwhile, healthcare organizations store large databases of patient health records, personal information, and details regarding clinical trials.
Both of these industries operate in different ways, which has led to hackers using specific attacks in higher frequency, allowing them to commit illegal activities such as identity theft.
Below is a list of frequently targeted industries and the cybersecurity incidents they commonly encounter:
- Financial Sector (Distributed Denial of Service (DDOS) attacks)
- Healthcare (malware, cyber espionage, stolen devices, and human error)
- Education (DDOS attacks)
- Public Sector (malware and cyber espionage)
- Information Sector (web application vulnerabilities)
- Accommodation (point-of-sale scams)
- Manufacturing (malware)
- Professional Services (malware)
- Retail (DDOS attacks, card skimming, and web application vulnerabilities)
The Cost of a Data Breach
These threats can result in large-scale data breaches, not only affecting customer trust and public image but also resulting in significant financial losses. Businesses can feel the lingering costs of a data breach from several months to even a couple of years, often encountering unexpected costs not previously budgeted for.
Long-tail costs can include data loss, operational and systems disruption, lost revenue, legal costs, and marketing costs to repair any damage to a company’s reputation. The effects of a data breach can differ from business to business and in terms of its scale, but financial implications and a detrimental impact on the company’s brand are always likely.
A Strategic Roadmap to Cybersecurity in 2023: Six Steps
For SMEs across a range of sectors, the digital landscape can seem daunting, with the threat of security breaches posing a serious risk to the future of a business. To mitigate this risk, companies must put in place processes that can safeguard them and their clients and ensure the correct actions are taken should a security incident occur.
Here are six factors to consider when implementing a cybersecurity strategy in 2023.
1. Security Updates
Device software should be updated and patched regularly to prevent vulnerabilities, such as zero-day attacks. Out-of-date software and devices can create security gaps that allow hackers to inject malware onto computers or networks and steal sensitive data.
This information could then be sold on the dark web, potentially resulting in identity theft and even financial losses. For example, a hacker gaining access to credit card data can open new accounts and make purchases or obtain cash advances in your company’s name. Keeping your devices and software up to date is one of the easiest ways to protect against identity theft and data breaches.
2. Downloading Email Attachments
One of the greatest weapons against cybercrime is employee education, teaching them to act cautiously and use the web responsibly, especially when downloading email attachments. Training should be provided to avoid opening links and attachments from unknown or suspicious sources to minimize threats.
3. Better Password Management
Strong passwords are vital to guard against various cyberattacks and keep your personal and company data secure. When creating a password, you should ensure they contain a mix of characters, numbers, and symbols that are impossible to guess. Passwords should also be changed regularly and never written down or stored in an unprotected folder.
4. Only Transfer Data When Necessary
In 2023, the amount of data transferred to remote devices will increase due to the widespread adoption of remote working models. This presents a high level of risk, especially if data is stored on personal devices. To mitigate this risk, employees should keep data transfers to a minimum, particularly data that contains sensitive information.
Monitoring the transfer of data and identifying any vulnerabilities or existing data leaks is vital in protecting a business or organization from future incidents. There are a range of automated tools that can make this process much easier, sending alerts should anything seem unusual.
6. Create an Incident Response Plan
Even with strict security measures in place and an ingrained employee culture of cybersecurity, a data breach may still occur due to a sophisticated attack going under the radar. If this happens, there needs to be an incident response plan in place that quickly mitigates the threat and recovers systems and data to minimize any downtime.
Cybercrime has increased significantly since 2015 and has escalated further since the 2020 Covid-19 pandemic. The financial and reputational damage caused by a data or system breach can be catastrophic for businesses, but implementing the necessary security can be a challenge, especially for smaller companies.
Fortunately, there are many steps that you can take that don’t rely on expensive software or require significant resources, instead focusing on employee education, best practices, strong processes, and a bit of common sense.