SMBs are particularly vulnerable to cyberattacks.
Here are alarming statistics from SecureWorld that should make Small- to Medium-sized Businesses immediately review their cybersecurity protocols:
- 46 percent of cyber breaches target businesses with less than 1,000 employees.
- 82 percent of ransomware attacks in 2021 targeted companies with less than 1,000 employees.
- 95 percent of cybersecurity attacks cost SMBs between $826 and $653,587.
- Ransomware attacks would force 75 percent of SMBs to cease operations.
The most shocking statistic is that 47 percent of businesses with fewer than 50 employees don’t have a budget for cybersecurity. These companies react after the damage is done rather than proactively defend against these attacks. Twenty-nine percent of businesses that experienced a digital intrusion responded by finding a cybersecurity company or hiring dedicated IT staff, which could be too little, too late.
These alarming statistics highlight the challenges small businesses face.
Cyber security challenges for small businesses
Small companies often lack the budget and skilled IT staff needed to implement and manage a cybersecurity team, which is a significant reason hackers target them. Cybercriminals see these companies as low-hanging fruit because they think these businesses lack sophisticated protection.
Small companies struggle to keep up with the ever-evolving cyber threat landscape, which is more complex today because hackers now use Artificial Intelligence (AI) to create the attacks. This rapidly changing landscape demands more cutting-edge defenses.
For small businesses, failing to adapt to this digital assault era can have catastrophic results. If cybercriminals target your company, you face potentially significant financial losses, loss of trust by your clients or customers, and even possible closure, such as:
- Efficient Services Escrow Group, which had nine employees, closed its doors after a cyber heist, which started at the end of 2022, stole $432,215 via a fraudulent wire transfer. In January 2023, the cybercriminals stole an additional $1.1 million.
- Green Ford Sales lost $63,000 from its bank account to cybercriminals, who added nine fake employees to its payroll in 2010. The bank could not recover $22,000 of the stolen money.
In-House vs. Outsource: The Cybersecurity Dilemma for Small Businesses
When it comes to protecting themselves from malware, ransomware, phishing, or Denial-of-Service attacks, SMBs have to decide on their course of action: manage it in-house or outsource it to a third-party vendor like a Managed Service Provider (MSP) or Managed Security Service Provider (MSSP). This is a crucial question small businesses must address.
The In-House Approach
Depending on how companies handle cybersecurity, an in-house approach can offer greater control, faster response times, and a better understanding of their company’s operations. However, this approach also comes with higher costs, the challenges of building a team, and the responsibility of managing a 24/7 operation.
In-house cybersecurity teams must have highly skilled IT professionals to keep their data safe. The cost will increase depending on the number of cyber professionals needed and the software or system used.
Without a large budget, small businesses may opt for low-cost basic protection. These protocols any company can implement with minimal staff and budget, including:
- Strong password protocols
- Two-step authentication
- Regular software updates
- Employee training
Companies can set up free or paid antivirus software, firewalls, and password managers. They may need a staff member with some basic IT ability. Small companies can also opt for open-source AI security tools, which are often free or low-cost options that provide basic AI protection. Freemium models offer minimal services at no cost, with paid add-ons for more robust security.
If you choose this no-frills strategy, be warned that you are not using professional-level protection. Remember the adage: “You get what you pay for.”
There are also cloud-based security solutions that don’t require significant upfront costs. Cloud-based services are scalable and eliminate the need for hardware and maintenance costs, but you may still need an IT person.
Another way to protect your company is to develop your own cybersecurity platform with the latest Artificial Intelligence technologies. In the long run, this may save your company money by automating many cybersecurity tasks, possibly enabling you to save on IT staffing or the monthly costs of outsourcing cybersecurity. If you don’t have in-house software development skills, you will need to find a highly qualified software solutions company.
The MSP/MSSP Outsourcing Approach:
Managed Service Providers, particularly Managed Security Service Providers, are popular for companies that don’t want to manage cybersecurity in-house. However, this approach requires handing over critical security responsibilities to a third-party vendor, so companies need to vet these companies carefully.
The benefits of outsourcing cybersecurity protection include:
- Cost savings
- Scalability
- Cybersecurity expertise
- Quick setup
However, disadvantages of outsourcing include losing control, varied response times, and potentially higher or hidden long-term costs.
The good news is that you don’t necessarily have to choose one or the other. Some companies are opting for a hybrid approach that includes the best aspects of outsourcing and insourcing cybersecurity operations.
Cyber Insurance on the Rise
Another protection method is cyber liability insurance.
An UpCity study shows that cyber insurance is becoming more popular, with 47 percent of those surveyed saying their businesses have bought this crucial protection. Cyber insurance can assist in paying for a variety of expenses, including lost income from a cyber disaster, notifying impacted customers, recovering compromised data, fixing damaged computer systems, and more.
AI is Leveling the Playing Field for Small Businesses
AI may be a savior for small and enterprise businesses in their fight against hackers because this advanced technology now powers the latest cybersecurity systems. This is vital because criminals are using AI to develop more sophisticated and insidious attacks.
Cybersecurity professionals have AI-powered antivirus and anti-malware software that can proactively detect and block threats, even new ones. AI-based intrusion systems will identify suspicious activity and potential breaches in real time. Today’s AI platforms analyze behavior to establish baselines and identify abnormal user or system behavior that could indicate a compromise. The system will scan for systemwide vulnerabilities and automatically update security updates and patches.
An AI-powered security software system will automate cybersecurity protocols and respond to incidents quickly with real-time data on potential threats and dangers.
Don’t Wait: Protect Your Business Now
Most responsible small businesses understand the dangers that cyberattacks pose. Business owners must protect their data and money; otherwise, they could end up without a company. They can protect themselves with an in-house approach, which can be inexpensive or costly depending on the complexity of their efforts. MSPs and MSSPs can fit into many companies’ budgets, especially if they would have to hire IT professionals to do it themselves. Building a customized cybersecurity platform gives companies more control and could save money depending on their costs to handle these tasks in-house or via an MSP/MSSP.
Regardless of their approach, small businesses should understand the risks they are taking by doing nothing or using only low-cost methods. These risks could be the difference between having a business and being unemployed.
Statista projects that cybercrimes will “skyrocket” in the coming years. Companies need to act now. Remember the cautionary tales of Efficient Services Escrow Group and Green Ford Sales? One went out of business because of a cyberattack, and the other lost money.
You don’t want that to happen to you.
About the Author
Gaurav Sharma is a Director of Operations at Chetu, a Global Software Solutions and Support Services provider. He oversees Chetu’s Artificial Intelligence and Cybersecurity projects. For more than a decade, Gaurav has driven innovation in many industries. He has established himself as a prominent technology industry leader and an AI development and implementation expert. Gaurav can be reached [email protected] and at our company website: www.chetu.com.
