Cyber Security and the Value of Your Company

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By Bill Minahan   |   October 23, 2019   |   3 Comments

Cyber Security and Business Valuation

Cyber security affects the value of your company. As a result, every executive and business owner should have the status of their own cyber security on their radar by now.

Especially executives who are looking to sell or are on the verge of selling.

cyber security and the value of your company

From a valuation perspective it’s simple, the stronger your cyber security is the less of a risk you pose to potential investors and future buyers.

There are many negative cyber security factors that can take away from the overall valuation of your company. Specifically, here are a few:

  • Unsecure network
  • Unsecure databases
  • Inadequate security measures on the cloud
  • Risky security policies
  • Lack of security policies
  • Uninformed or untrained staff
  • Firewall misconfigurations
  • Outdated applications and software

Having one or more of these could make your business too risky of an investment for most investors.

Businesses of all sizes rely more on technology than ever before. As a result, day to day operations, IT infrastructure, networks, internal and external communications, and data are all only as valuable as the cyber security policies and protocols that protect them.

How does cyber security affect the value of your company?

It is easier than ever to determine if a business has adequately invested in their cyber security.

All it takes is a quick network security assessment to reveal the state of your IT infrastructure. Think of it as an audit, it’s an inspection of the entire network, policies, people, and systems within an organization.

More often than not, it exposes a myriad of vulnerabilities.

Every company with a network has vulnerabilities that pop up once in a while. Risks and vulnerabilities will occur. It’s the policies and protocols we use to manage and mitigate them that matter the most.

However, if companies neglect their cyber security for years, then the risk they pose is more severe.

Many elements that contribute to a company’s value rely on adequate cyber security. Without it, the following lose their value to investors:

  • Intellectual property
  • Customer records
  • Employee information
  • Marketing tactics
  • Data operations
  • Financial records

And more.

Think about it this way: a potential investor is looking to buy a bank. The bank is beautiful, well-staffed, has many clients, and favorable brand recognition.

They manage a myriad of wealth, but their security measures are outdated and, in some areas, nonexistent. After further inspection, the property and staff are all vulnerable to all sorts of break-ins and thefts.

To make matters worse, the area is riddled with crime.

As a result, the investor must walk away because it’s too risky.

Unfortunately, this is the state of cyber security for most businesses today and their valuation suffers.

The internet has never been as full of cyber criminals as it is today. It is the area riddled with crime and it’s been that way for a while. Cyber attacks occur every 39 seconds.

To sum it up, businesses that are more susceptible to cyber attacks are less valuable.

How to strengthen your cyber security

If you’re looking for investors or potential buyers, you need to clean up your cyber security first. In doing so, your company’s valuation will be higher.

Our number one advice to business owners trying to gain control of their cyber security: A network security assessment.

A network security assessment is a cyber audit that picks apart your entire network, highlights the good and the bad, and prepares a list of recommendations and solutions.

Essentially, it’s exactly what potential investors would look at before making their decision to invest in your company or not.

You can’t begin to strengthen your cyber security until you understand what’s wrong with it in the first place.

Likewise, if you don’t assess and fix the risks surrounding your current cyber security, then you can’t expect buyers to value it favorably.

Take Your Network Security Assessment Today

Finally, If you’re looking to sell your company or attract investors and are looking for cyber security advice from the experts, aNetworks offers free consults.



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