Steps to perform cybersecurity Risk Assessment in startups

When most startups begin their journey, they primarily focus on generating revenue, marketing, and finding their niches in the industry. During this starting phase, most startups put cybersecurity in the backseat. There are hacking attempts every 39 seconds, and ironically, startups are the most vulnerable. That makes managing risks for startups a necessary step, and it starts with a risk assessment. Lack of risk assessment translates into improper risk management when adversity strikes. On the other hand, a successful risk assessment process aligns with your business goals and reduces risks effectively.

Cyber risk- what is it?

Cyber risk happens due to faulty disruptions to finances, business operations, or sensitive data online. Generally, cyber risks are linked to episodes that might result in a data breach.

Some examples of cyber risks are:

  • Ransomware
  • Phishing
  • Data leaks
  • Identity thefts
  • Malware
  • Insider threats 

Experts categorize Cyber risk from zero, low, medium, to high-risks. Furthermore, there are three factors to impact vulnerability assessments, namely:

  • Finding the threat.
  • Rate of system vulnerability
  • Rate of financial or reputational damage of breach occurs.

Defining Cyber Risk Assessment

Cyber risk assessments, as defined by the NIST (National Institute of Standards and Technology), “are used to identify, estimate, and prioritize risk to organizational operations, organizational assets, individuals, other organizations, and the Nation, resulting from the operation and use of information systems.”

Let’s look into how you can perform a cyber risk assessment step-wise.

Performing a cyber risk assessment

Step 1: Determining Information Value

Most startups don’t have the budget of big corporations to invest in information risk management. That means it’s best to focus on most business-critical assets. How do you determine the information value? These questions will help you do that:

  • Are there any legal or financial penalties for losing or exposing this information?
  • How will this information benefit the competitors?
  • Is it possible to create this information again from scratch? What is the cost and time damage to do it?
  • Will there be an effect on the profitability or revenue if we lose this information?
  • Will the data loss affect the day-to-day business operations? Will it affect the staff’s output?
  • What is the reputational damage of this data leak?

Step 2: Recognize and Compute Assets

You need to start with identifying assets to assess and define the scope for a complete assessment. The step will let you compute and prioritize a particular asset for evaluation. 

For each asset of the business, you need to accumulate this information where applicable:

  • Software
  • Hardware
  • Purpose
  • Criticality
  • End-users
  • Data
  • IT security policies
  • Network topology
  • Physical security controls

Step 3: Ascertain cyber threats.

Cyber threats consist of any vulnerability to exploit and breach security to steal data or harm your company. The first cyber threats that come to mind are malware and hackers, but there are other threats to look out for as well:

  • System failure: Are you using high-quality equipment to run your highly critical systems?
  • Natural disasters: Hurricanes, floods, earthquakes, fire, etc., can cause as much destruction as a cyber attacker. There are high chances of losing your data and your servers. 
  • Human error: Is your staff trained about malware, social engineering, and phishing? Anyone can click on suspicious links accidentally at work and jeopardize company data. The need is to establish strong IT security controls like a password manager, data backups, etc.

Other common threats to look out for:

  • Data leaks: Staff’s Personally Identifiable Information (PII) and other sensitive data are prime targets.
  • Data loss: Accidental loss or data deletion due to poor backup process.

Step 4: Recognize the vulnerability.

A vulnerability is a weak spot that anyone can exploit to steal critical data, breach security, and cause reputational or financial harm to the organization. Startups can find vulnerabilities via audit reports, vendor data, vulnerability analysis, the National Institute for Standards and Technology (NIST) vulnerability database, etc.

Vulnerabilities like software-based can be reduced through clear-cut patch management through automatic forced updates. While you can avoid physical vulnerabilities through means like keycard access.

Step 5: Result documentation from risk assessment reports

At last, to create a risk assessment report, you need to support management through decision-making in areas like policies, budgets, and other procedures. The report must describe each threat, vulnerability, etc. It must also mention the impact and occurrence probability along with control suggestions.

Concluding note

One of the major cyber threats includes identity theft, where thieves steal an identity to access a company’s services. This is among the significant threats that bother financial sectors, and thus, they rely on identity verification. The KYC and customer onboarding steps use identity verification to ensure the true identity of a person. Companies like iDenfy are working tirelessly to develop advanced identity verification tools with high positive verification results. To find out more, click here.

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