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The Real Cost of Ransomware Attacks on Small Business

September 24th, 2021 by admin

Victim of ransomware

From Colonial Pipeline to the National Basketball Association (NBA), ransomware has been a nuisance for a variety of businesses throughout this year. Despite existing in different industries, there’s one common trait these victims share … they’re all considered big businesses. However, ransomware attacks aren’t limited to only large corporations. While companies like KIA, Acer, and others may be the ones that make news headlines, small businesses are just as likely to get hit by a ransomware attack.

Ransomware Attacks on Small Businesses

The truth is, business cybersecurity breaches pose a risk to all businesses. In 2018, the Ponemon Institute found that 67% of the small and medium-sized businesses they surveyed suffered a cyberattack and 58% experienced a data breach. Among the many forms of cyberthreats lurking out there on the web, ransomware has been especially dangerous for business.

Ransomware is a type of malware that holds a victim’s information for ransom by encrypting said information. It is specifically designed to spread across a network, seizing files, documents, databases, and more. Knowing this, it should come as no surprise that a ransomware attack can quickly paralyze an organization.

Not only are ransomware attacks growing in frequency, but they are also costing organizations more to fix. From 2018 to 2020, the average cost of ransoms jumped up from $4,300 to $8,100 according to PurpleSec. That’s a $3,800 increase in only two years. The report also states that the average cost of downtime caused by ransomware was $283,000 in 2020.

How ransomware affects business differs depending on the size. For a large company, it wouldn’t be too difficult to bounce back from such an expense. But how would losing so much money impact your small business? It’s not uncommon for small companies to go out of business because of a ransomware attack.

What Happens When a Company Gets Hacked?

The last thing any business owner wants is to find out, first-hand, what happens after a cyberattack. Depending on the situation, it can result in a variety of outcomes. Some of the more common being:

  • Financial Loss: This includes the cost of recovery, lost income from downtime, and any money you pay toward the ransom (it’s recommended that you never pay the ransom).
  • Reputational Damage: While not as quantifiable as financial loss, reputational damage is an essential part of a business relationship. If your business falls to a security breach, it could shake your customer’s or partner’s confidence in your organization.
  • Legal Consequences: Data protection and privacy laws require businesses to maintain the security of all personal data you hold for your customers, as well as employed staff. If you fail to protect this information, whether accidentally or deliberately, your business could face regulatory fines or sanctions.
  • Data Damage: For your business, you rely on data to inform your decisions. A successful cyberattack could potentially damage or erase important information. Losing valuable data could set a company back weeks, months, or even years.

Why Are Small Businesses Targeted?

You would think that hackers would focus all their attention on large companies to get as big of a payday as possible. However, cybercriminals aren’t picky when it comes to their targets. One reason why is because many small businesses don’t take cybersecurity seriously. If you don’t have an adequate defense, a hacker could see your company as easy pickings.

Another reason why cybercriminals go after small businesses is because of information. While your small business may not have as much to offer—in terms of money—as a mega corporation, your company does hold valuable data. Sensitive information can be used or sold on the dark web for a large profit.

How To Keep Your Company Safe

If you want to avoid falling victim to a ransomware attack, it’s necessary to have strong cybersecurity measures in place. Hiring an IT department for this purpose can be unrealistic for some small businesses. If you fall under this category, outsourcing your IT provides all the benefits of an internal IT department at a fraction of the price.

Stay Secure With Americom

At Americom, we offer managed cybersecurity services. This is a solution where we handle all of your cybersecurity needs. From assessments to network monitoring we keep your network protected so your team can work worry-free.

Contact us today to learn more about ransomware and how to protect yourself.

Posted in: Cybersecurity