In today’s world, where digital innovation drives business growth, startups are facing a challenging cybersecurity landscape. They have to face a reality where their digital foundations can be shaken by tech-savvy teenagers and cybersecurity incidents can result in their valuations being reduced by millions and in some cases even lead to failed deals. As a result, being proactive about cybersecurity has never been more important for startups.
By Zsolt Fabian
Cybersecurity is more than just an IT issue. It is a complex beast, blending tech smarts and business. It encompasses everything from data protection, firewalls, and antivirus to sophisticated tactics that align with the company’s growth and innovation goals. It is no longer just a techie thing but a silent game-changer to a startup’s success. Investors want to see that you have a grip on cybersecurity and expect you to be capable of handling it. Today, cybersecurity has become a fundamental survival skill for a startup.
A proactive approach of the founders and management is crucial for an effective cybersecurity strategy. On a personal note, this approach is a key driver of my motivation, keeping me awake at night as we work to ensure the privacy of our hundreds of millions of customers.
“Contrary to popular belief, security is not just a matter for techies – it is a responsibility that lies with founders, CEOs and CFOs.”
Fabian Zsolt, head of IT security at Byborg Enterprises
Startups should view cybersecurity as a catalyst for innovation and growth, not just a compliance measure. In the startup ecosystem, cybersecurity acts as a silent, but pivotal game-changer, which is essential to your long-term success because you will be able to demonstrate that you understand how digital works. The pressing question is, how will you, as a founder, and executive, lead or an innovator leverage cybersecurity to propel your company forward?
Investors are thorough and always on the lookout for potential dealbreakers, such as undisclosed cyber incidents. Many years ago, I was working on the M&A acquisition side with a NASDAQ-listed company. During the acquisition process of a startup, it was found that their customer databases and millions of passwords were breached. The incident significantly lowered the valuation, a common consequence I have observed in startups since.
Common issues included unrestricted admin rights, the use of outdated software, and using identical passwords for staging, testing, and production systems. We later learned that the attackers had exploited a wireless connection to a development server sitting on the office carpet. Neglecting a cybersecurity roadmap led to five more breaches over the coming decade for the company.
Digital resilience is key
Digital resilience is set to become the most important focus for many startups in the coming years. It will involve creating systems where human-AI interactions within an organization can adapt to cyber threats quickly and effectively. Executives must spearhead these developments and ensure that their colleagues are vigilant and well-prepared against cyber threats. It is about cultivating a culture of security awareness and making security the responsibility of everyone.
Without advocating this way, individual employees, and departments in your organization will be systematically targeted by hackers who are better organized than ever. The commitment to cybersecurity must originate from founders and C-level executives taking the lead to inspire, inform and orchestrate it. Above all, you have to be equipped to manage cyber challenges.
In today’s world, it does not matter if you are not a tech-centric startup. They can still take you down whether you are in logistics, agriculture, or fintech. It is about devising a comprehensive strategy that aligns with your innovative and growth objectives.
“I am often faced with objections such as “We don’t have the budget” or “We lack the resources”. Such objections shall not be part of your culture. A hacker will not consider your budget constraints and shortages; they won’t lose sleep over the revenue you’re missing out on while your systems are compromised for days.”
Fabian Zslot, head of IT security at Byborg Enterprises
The sensation of receiving investment for your startup and your team is immensely rewarding. With solid cybersecurity foundations in place, having a genuine interest in the subject, and stimulating your team’s engagement, you can clinch a deal without worrying about losing value. For investors today, it is essential that cybersecurity is part of your startup’s DNA. It is no longer just a matter of paperwork, it is the responsibility of the entire company.
This article was first published in the Silicon Luxembourg magazine. Read the full digital version of the magazine on our website, here. You can also choose to receive a hard copy at the office or at home. Subscribe now.
