Ransomware threats continue to loom large despite forecasts of reduction, with private equity portfolio companies (portcos) finding themselves prime targets post-acquisition. Cyber risk specialists KYND delve into the issue to understand the elevated risks facing portcos and discover essential steps to fortify their cyber resilience.
Ransomware, a malicious software encrypting data until a ransom is paid, poses a severe threat to portcos. Often holding a treasure trove of sensitive information across industries like healthcare, finance, and technology, these companies become ideal targets for cybercriminals. Fuelled by financial backing from private equity firms, portcos attract unwanted attention due to perceived higher financial resources and weaker cybersecurity maturity.
The injection of capital intended for growth, ironically, places portcos squarely in the crosshairs of ransomware attackers. During investments, cybersecurity often takes a backseat in due diligence, exposing vulnerabilities that cybercriminals exploit post-acquisition. Personnel changes and shifting priorities further delay robust cyber risk measures, offering additional windows of opportunity for attackers.
Lack of in-house cyber expertise and an expanding attack surface due to intricate supply chains elevate portcos’ vulnerability. Small-sized companies lack dedicated cybersecurity resources, making them easier targets. Moreover, interconnected business ecosystems amplify risks, allowing cybercriminals access through third-party vendors.
Amid this complex landscape, understanding and managing cyber risks during investment phases become critical. Cyber risk assessments, part of due diligence, help identify vulnerabilities early, guiding better-informed investment decisions and aiding strategy development for resilient cyber defences.
Continuous monitoring post-investment bolsters cyber resilience, identifying emerging threats, and leveraging tools like penetration testing and continuous monitoring to swiftly address evolving cyber risks. Strengthening cyber risk management aligns with regulatory compliance, maintaining operational continuity and protecting sensitive data.
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