Individuals and businesses are more connected than ever. An estimated seven billion devices are connected to the internet, and cybercriminals are seizing the opportunities these entry points provide. With cybercrime set to become more sophisticated as technology evolves, businesses and wealthy individuals should explore the investment opportunities of cybersecurity.
Digitalisation is transforming how people work and live. Remote working tools, online financial platforms and virtual assistants, like Google Home and Amazon Alexa, are just some of the technologies at the heart of this shift. Medical apps are helping individuals self-manage their health and could even revolutionise the doctor/patient relationship in the near future.
New technologies bring enormous opportunities for businesses and individuals to cut corners, saving time and money. But they also bring significant new threats.
Cybercrime is estimated to be a $400 billion global industry1 . Technology is providing a gateway for criminals – but there is also an opportunity for entrepreneurs who can counterattack with sophisticated cybersecurity. As technology and threats evolve, companies that keep pace with cybersecurity innovation stand to benefit, along with their investors.
Evolving entry points
We are already seeing how the rise of the internet of things, bring your own device arrangements and cloud systems are reshaping businesses and the day-to-day lives of individuals. Mobile phones have been enabling people to access personal, financial and other sensitive information from almost anywhere and at any time for a number of years. But they are also creating more entry points for cyber criminals, with emails and apps storing personal information held on one device.
According to RSA Security data, 70% of fraudulent transactions in 2019 occurred on mobile phones. In 2018, Amazon founder Jeff Bezos had his phone allegedly hacked by Saudi Crown Prince Mohammed bin Salman through WhatsApp. The high-profile case raised the alarm for mobile phone security.
Another high-profile case includes the WannaCry ransomware in 2017 that held public and private organisations hostage with threats of a data leak. There have also been recent reports that some state-sponsored cyberattacks are using the Covid-19 outbreak as a means for espionage. It is believed these attacks are a way to gain intelligence about how other states are dealing with the pandemic.
Empowering clients through cybersecurity
Financial confidence plays a crucial role in self-determination, enabling individuals to take risks with the assurance of a safety net. As a result, cybersecurity is becoming an increasingly important aspect of financial confidence.
Rather than simply a way to protect organisations and assets – cybersecurity is also important for protecting individuals, families and the things that matter most to people. The founder of Rubica, a company that offers digital protection for families, explains: “The new cyber warfare is going after your kids’ iPad, not your executively controlled phone.”
According to the Financial Times, personal security is a growing industry and offers services ranging from secure password managers and anonymous web browsing to cyber bodyguards that monitor and respond to suspicious activity on personal devices. Requests for private security have already seen an uplift. Following reports of the Bezos WhatsApp cyberattack, Rubica’s founder reported a surge in enquiries. As cyberthreats continue to bear and individuals look to take control of their finances, demand for these services will only grow.
Lucrative cybersecurity opportunities
The evolving nature of cyberthreats makes cybersecurity innovation particularly desirable for businesses and investors. According to McKinsey, there are 120 million new variants of malware created every year.
A report by KPMG1 cites automation, AI and social engineering as key aspects of cyberthreats in the future. Technology developments are not only creating more entry points for cybercrime but also making it more sophisticated and tailored to the target. Organisations and people will need to respond quickly to counteract threats.
A McKinsey report reveals that 75% of risk management experts believe cybersecurity should be a top priority for businesses. However, the report also says only 16% of executives are confident their cybersecurity is robust enough to deter threats2. This leaves a significant gap for innovative, effective and tailored cybersecurity solutions to fill.
The need for investment flexibility
Cybersecurity presents a lucrative opportunity for investors and spending in this area is expected to grow 12% annually up to 2022, according to Morgan Stanley3. The global financial firm anticipates tools that respond to attacks will see the most growth.
Investors stand to benefit from investing in promising cybersecurity development. But in order to do so, they will need the flexibility to decide how their wealth is invested. In the same way that technology needs to be adaptable to respond to threats, investors should have the freedom to respond to developments and choose where best to invest their wealth.
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Sources:
[1] KPMG - Building cyber-resilience in asset management
[2] Mckinsey - A new posture for cybersecurit in a networked world
[3] Morganstanley.com - Cybersecurity investing