On cybersecurity, small businesses must stay only one step behind


William Schrader, CEO of LeaseWeb USA, has helped build several Internet firms since his days at PSINet. (Jeffrey MacMillan/JEFFREY MACMILLAN FOR WASHINGTON POST)
October 2, 2012

Cyber crooks are constantly developing more effective ways to penetrate computer networks and extract sensitive information, and small companies with less capital to spend on sophisticated protection measures are a common target of attacks.

Frankly, there is no way to stay ahead of the criminals. Instead, for business owners, the key is to stay no more than one step behind, according to William Schrader, one of the D.C. region’s Internet pioneers who was recently appointed CEO of LeaseWeb USA.

“Hackers are very clever, and they communicate very fluidly and covertly,” Schrader said in an interview. “Once a penetration or vulnerability is made available, the hacker community will know about it, and you simply have to play catch-up and avoid suffering more damage than necessary.”

Schrader, who previously built PSINet into a $16 billion firm in the 1990s, took this latest executive position two weeks ago. He is no stranger to start-ups, having played a role in building many Internet-focused companies since his days at PSINet.

Schrader said small business owners with any type of online presence or digitally stored data should take every affordable precaution to ward off attacks, starting with installation of inexpensive firewalls on every computer with an Internet connection. He also said that each company that takes its business online should be prepared to either hire a technology specialist or at least outsource its online protection needs to an IT provider.

Several studies in the past year have shown that small businesses are some of the most commonly targeted victims of cybercrime. And that is not likely to change. The tactics of today’s cybercriminals are simply evolving too quickly for most firms with limited technology resources to keep up, Schrader said, and cybersecurity insurance is becoming a must — especially for firms that conduct financial transactions over the Internet.

“The biggest issue for small businesses is losing a customer’s financial information,” Schrader said, noting that small banks and online retailers are particularly at risk. “If you take a customer’s credit card information, and it’s stolen from your Web site, you have a certain liability that has been proven in court, and that can be awfully dangerous for small businesses. If you’re going to take that type of information, you really need to have insurance to protect against it being stolen.”

Despite the threats, Schrader said business owners cannot let the risks outweigh the countless marketing and customer relations advantages that come with adding an online presence for their companies.

“Simply putting up a Web site is probably the easiest, cheapest form of advertising available to small business owners, and these days, you have to be able to conduct your business online,” Schrader said. “The threats are always going to be there, but in a sense, it’s okay to be one step behind the criminals, as long as you’re only one step behind.”

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J.D. Harrison covers startups, small business and entrepreneurship, with a focus on public policy, and he manages the Post's On Small Business blog.
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