SMBs Know the Risks, So Why Are Cybercriminals Still Winning?

Cybercriminals are no longer primarily focused on large enterprises. They now see small- and medium-sized businesses (SMBs) as prime targets because they lack the resources, expertise, and robust security measures that larger businesses can afford.

As a result, cybersecurity is now a matter of survival for SMBs. In fact, new research found that 1 in 5 SMBs could shut down for good after a cyberattack.

SMBs are beginning to grasp the severity of the threat – with 60% acknowledging they’re at a heightened risk compared to their enterprise counterparts. But with 80% recognizing vulnerabilities in their current defenses, they’re positioned to fall dangerously short when it comes to action. Luckily, Artificial Intelligence (AI) is emerging as a key solution for SMB protection and resilience.

Cybersecurity: A Risk Too Big to Ignore

Ask any SMB owner what keeps them up at night, and cybersecurity is near the top of the list. In fact, it ranks as the second biggest business concern among SMBs – second only to inflation and rising costs.

And for good reasons. One successful cyberattack could mean financial ruin. Over half of SMB owners report that losing $50,000 to a cyberattack would be enough to force them to close their doors for good. Many SMBs operate on razor-thin margins. Losing just $10,000, an amount that could equate to a single day of disruption, would mean “game over” for 30% of SMBs.

Despite this, a dangerous paradox exists: SMBs recognize their risk but remain unprepared.

The Gaps Leaving SMBs Exposed

Cybersecurity should be treated with the same urgency as other critical business functions like sales and marketing; however, it often receives significantly less investment and attention from many SMBs. The gaps are clear. 1 in 3 are working with outdated cybersecurity technology. 23% admit they don’t fully understand their cybersecurity risks. 26% acknowledge the person managing their cyber program lacks proper training.

And here’s the kicker – the untrained “cyber expert” managing their security posture is often the business owner themself. An alarming 74% of SMBs either self-manage their cybersecurity or rely on friends and family members, creating a dangerous expertise gap.

Beyond expertise, many SMBs are making avoidable security mistakes. Weak passwords remain a common pitfall, with nearly a quarter of businesses using easily guessed credentials like “123456,” pet names, or “store staff.” Others admit to never backing up their data, failing to train employees on cybersecurity best practices, missing regular software updates, or ignoring security for internet-connected devices like mobile phones.

Neglecting these fundamental protections has real consequences. Many SMBs experienced website downtime (45%), point-of-sale failures (33%), or fraudulent credit card activity (31%) over the past year. The financial impacts extend beyond the initial attack, leading to lost customers, lower sales, and lawsuits from affected clients and partners.

Cybercriminals Are Getting Smarter

On top of obvious cybersecurity gaps, cybercrime is evolving at an alarming rate – experts say cyber criminals are getting 10 to 14 minutes faster every year. SMBs are struggling to keep pace. Small businesses are twice as likely to miss a sophisticated cyberattack – such as a deepfake – compared to the more obvious disruptions like network downtime. As cybercriminals increasingly leverage AI, SMBs must be prepared to recognize and respond to new age threats.

While many have basic cyber tools like antivirus (50%), real-time threat monitoring (47%), network scanning (47%), and firewalls (44%), these alone won’t keep them safe. More advanced protections – like penetration testing, endpoint monitoring, and endpoint security – are still missing from most SMB cybersecurity strategies, but they don’t have to be.

The Business Case for AI: The New Era of SMB Cybersecurity

As expertise and resource gaps persist, SMBs are searching for solutions – like AI. In fact, 65% see cybersecurity as the #1 business function that could be managed more effectively with AI – ranking ahead of sales, marketing, and customer service. The same technology that gives cybercriminals an edge can also level the playing field for SMBs.

AI helps bridge the expertise gap, offering real-time threat detection and automated responses – no in-house security team required. More than half of business leaders (55%) believe AI can identify cyber threats before they disrupt operations, and nearly half (49%) say it can provide real-time response recommendations. It can also tackle the everyday security missteps that leave SMBs vulnerable, from generating strong passwords to automating software updates.

AI brings scalability that SMBs desperately need. As the volume and complexity of threats increase, AI can continuously learn, adapt, and scale protection in a way that manual processes simply can’t. It empowers SMBs to move from reactive to proactive cybersecurity strategies, detecting patterns across systems and flagging anomalies before damage is done. And as AI tools become more accessible and affordable, even the smallest businesses can implement enterprise-grade protection – without breaking the bank.

The Time to Act is Now

For SMBs, cybersecurity is no longer optional. A single attack can determine a company’s fate. While AI won’t eliminate all risks, it can be a force multiplier, lightening the load on small teams while strengthening defenses against an increasingly sophisticated threat landscape.

The choice is clear: invest in cybersecurity now or risk everything later. The first step is understanding your current security posture. Start with a cybersecurity assessment to identify where your gaps exist. This can be done by leveraging cyber risk scores, which can quickly pinpoint your priorities. Then, take a data-driven approach to your investments, and remember: cybersecurity isn’t a one-and-done exercise. Continuously monitor your environment to measure the impact of your efforts and stay ahead of emerging threats. The earlier you act, the stronger your position will be in this relentless threat landscape.

About the Author

Kevin Pierce is the Chief Product Officer of VikingCloud. He has been with VikingCloud since 2016. Kevin leads the company’s global product development, service delivery, consulting, and managed security testing teams as they leverage machine learning and artificial intelligence to deliver next-generation cybersecurity. During his nearly 30 years in the technology space, Kevin designed and built highly scalable cloud systems for secure data exchange, supply chain optimization, and cybersecurity in multiple industries. He also co-founded two technology companies that each grew to hundred-million-dollar valuations prior to exit. Kevin can be reached online at https://www.linkedin.com/in/kevin-pierce-0b740a1/ and at our company website https://www.vikingcloud.com/.