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Cybersecurity for Startups: A Step-by-step Guide for Every Phase

A startup grapples with the uncertainty of success, lack of funding, competition for human resources, and an overload of ideas to try out. Challenges build up in different directions as the startup grows and cybersecurity often takes the backseat. 

59% of business owners think their business is too small to be attacked whereas 43% of cyber attacks target small businesses.  The employees at small businesses are targeted with 350% more social engineering attacks than people working for large enterprises. (source)

Hackers like to take advantage of startups’ absence or immaturity of security measures. Startup owners can discourage cybercriminals and force them to look for easier prey by implementing some simple security strategies.  

This step-by-step guide for setting up cybersecurity for startups addresses each major phase of a startup’s journey. 

A step-by-step guide to setting up cybersecurity for startups

As a startup grows, its security requirements change. This step-by-step guide segments a startup’s journey into four broad phases and attempts to cater to the specific security needs of each phase.

Phase 1: Pre-MVP

The startup is pursuing an idea, building a codebase around it, and acquiring developer resources, but does not have enough funding to make heavy investments in cybersecurity. This is a crucial phase for laying down the initial layer of protection.

Step 1. Secure the production environment

The production team is likely to adopt managed cloud services like Google Cloud, AWS, or Microsoft Azure to host the infrastructure.

  • The cloud services need to be well-configured
  • The production environment has to be kept separate from other things
  • Enclosing everything in a virtual private cloud adds protection
  • No one outside a whitelist of IP addresses should have access to the environment
  • Access to the production server and databases should be restricted

Step 2. Secure the servers and services

  • Any service that engineers work with should be protected by multi-factor authentication
  • The production configuration should be moved out of the code into a separate repository.
  • User credentials should be hashed and stored with a reliable and business-only password manager

Step 3. Build a culture of security

Investing time in the inculcation of secure habits and a security-first approach to each task at this early stage is sure to pay dividends.

  • Engineers should be trained in secure coding practices
  • Each employee should bear accountability for sensitive data and access

Phase 2: MVP to Seed

In this phase, the startup is likely to have customers. Hence, there is the added responsibility of safeguarding customer data.

Learn how startups can overcome the challenges of securing a budget for cybersecurity, such as the lack of awareness of the importance of cybersecurity and the high cost of security solutions.

Step 4. Implement a strong password policy

IT leaders must come up with password policies that encourage users to create stronger passwords without complicating the login process. The enablement of 2FA for users is a crucial step in this phase.

The startup should implement standard encryption to protect the directory or database that contains user credentials and other sensitive information.

Using an enterprise-grade password management tool increases internal password security manifold.

Step 5. Stronger security measures for the IT infrastructure

  • Databases should be backed up and stored behind encryption
  • Encrypt data at rest and in transit
  • Critical resources should be available only through the virtual private network
  • Employ firewalls and antivirus software

Step 6. Vulnerability assessment

At this stage, a security assessment of the product and the source code can help maintain a solid security posture. IT admins can enlist the help of a vulnerability assessment and penetration testing provider and implement attack surface monitoring tools.

Step 7. Implement foolproof onboarding and offboarding policies

A survey showed that 31% of companies had former employees who accessed data stored in SaaS applications even after leaving the organization. That is a major security weakness for businesses regardless of their size and age. 

Current or former employees should be granted access to data and applications when they need it only as much as they need. And the access should be diligently revoked when the need is served.

Onboarding and offboarding policies should account for all accesses and be enforced without failure.

Phase 3: Seed to Series A Funding

At this point, the company is burgeoning. It has some money, more customers, and an opportunity to invest in cybersecurity measures, security protocols, and policies.

Step 8. Choose better security software

Application security testing and security audits can be expensive and stressful. In this phase, startup owners can consider finding suitable security tools with better security features – ideally, a vendor offering point-in-time security assessment combined with continuous attack surface monitoring. 

Startup owners can review and upgrade the firewall and antivirus software at this stage. 

Step 9. Employ Intrusion Detection systems and vulnerability scanners

Integrating an automated vulnerability assessment and feedback mechanism with the organization’s CI/CD (continuous integration/continuous deployment) pipeline can make secure coding significantly easier for engineers. This way a startup can avoid ever sending vulnerable code to production.

Setting up an intrusion detection system and devising an incident response plan are two major activities for startups in this stage. This is healthy paranoia because this is the phase when hackers get attracted to startups.

Step 10. Build cyber attack preparedness

  • Simulate “end-of-the-world” scenarios so that the incident response plan can be tested
  • Run enterprise-wide cyber security awareness training programs 
  • Identify and take control of shadow IT

Learn how to respond to a cybersecurity breach in your startup, including how to identify the breach, contain the damage, notify affected parties, and mitigate the risks.

Phase 4: Post-Series A Funding

The startup now has more employees and a lot of customers. This is the time for scaling cybersecurity efforts.

Step 11. Run a bug bounty program

White hat hackers can help a startup dig up security loopholes and business logic errors missed by automated scanners. Not only does this strengthen the organization’s security posture, but it also adds to the security-conscious brand image.

Step 12. Improve security management

At this stage, data is coming in from too many security tools. There is a possibility of missing out on crucial alerts and losing productivity over false positives. 

  • Employ a change management tool to control any change in the production system
  • Use a security information and event management tool to integrate information coming from all security appliances into one intuitive platform

Learn about the most common cyber threats facing startups, such as phishing, malware, and ransomware.

Step 13. Implement an auto-login system for all the teams

Cyber threats like phishing, credential theft, and other types of attacks that exploit human errors can be countered by implementing an auto-login system. Uniqkey, for instance, enables automated employee logins. It fills out login pages and the 2FA information, thereby eliminating the manual logging process. This adds an extra layer of security to user accounts. 

Best practices to secure your startup

The security best practices discussed in this section apply to all stages of a digital startup across industries. These will make it harder for malicious actors to encroach on your systems, making them move on to the next target.

1. Do not delay software updates

When a software provider launches an update, the update likely contains a patch for a security weakness. By delaying software updates, you risk running a vulnerable system and missing out on bug fixes and security updates. 

2. Install an SSL certificate

A secure sockets layer certificate is signified by the HTTPS requests as opposed to the ill-secure HTTP request. The SSL certificate ensures that the transmission of requests to and from your server is encrypted. 

3. Use secure cloud storage

The cloud storage provider that hosts a startup’s data and infrastructure and also provides storage space for sensitive data should be governed by stringent security protocols. 

Cloud security is maintained through a shared responsibility model. Usually, the cloud provider is responsible for securing the cloud infrastructure and operating systems, and the cloud user is responsible for securing the data that moves in and out of the cloud. 

4. Set strong passwords and never share passwords in plain text

This one applies to every business and individual trying to protect its data from being stolen. A strong password is long and consists of multiple character types. The longer the password, the harder it is to guess. 

Passwords should never be shared in plain text – via email, text, or other communication channels. Admins and leaders should use zero-knowledge password managers to encrypt and store all passwords. Employees should have role-based access to the password vault.

Uniqkey stores passwords with military-grade encryption and offers features like automated employee login, password generator, secure password sharing, and centralized access management through an intuitive dashboard.  

5. Choose security-conscious vendors

Security should be at the top of the list of priorities when choosing a third-party vendor for your startup business. A vulnerable SaaS application with a startup’s data can compromise the startup and all its clients in a single incident. It can practically ruin the startup’s reputation, block the revenue stream, and expose it to penalties and legal action.  

Sadly, 60% of startups that suffer a data breach go out of business within six months. But it’s not hard to avoid that fate. 

Stay on top of the cyber threat landscape. Set up robust security policies that will make your organization more auditable. Review your company’s cybersecurity status frequently, and implement up-to-date cyber security measures for startups to embolden your organization against emerging threats. 

Note: The information in this blog post is for educational purposes only. It is not a substitute for professional advice. We advise you to do your research and consult with security professionals to get the best advice for your situation.

Security is a constantly evolving field, and what works today may not work tomorrow. You should always be on the lookout for new threats and vulnerabilities and be prepared to adapt your security measures accordingly.


Uniqkey is the perfect password management solution for teams and businesses. Built with high usability in mind, Uniqkey makes it easy for employees to adopt secure password habits, raising company-wide security in a simple and effective way.