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Data Privacy and Startups

Updated: Apr 3

The following is an article “Data Privacy and Startups” by Marc Primo Pulisci


Startup companies often encounter an overwhelming amount of information in the form of customer/employee records, operational metrics, and process documents, to name a few. These are all necessary to enhance a startup’s business strategies and marketing plans that help determine its overall performance. That said, data privacy should always be on top of your priorities especially if you are a first-timer in the world of entrepreneurship.

Cyber crimes continue to be prevalent as many individuals and organizations are still being victimized by phishing and data theft. Startups become potential targets because they prove to be a goldmine of information for hackers and today, information is big currency. Data stored in the cloud or unsecured websites usually contain sensitive user information that can be easily accessed illegally with minimal equipment. Businesses may find themselves at the raw end of a deal because of data theft done in normal and routine processes such as email retrievals, P2P transfers, online downloads, and even sign-ups.

If you are trying to put up a new startup company and want to get the most out of your online protection systems, consider these important facts that can help you set up the right programs you need for data privacy.

Most startups can’t afford a data breach. Financing efficient systems for data privacy may cost a bit but it will cost you more without them. In 2018, U.S. companies that experienced a data breach had to pay $3.6 million on legal fees alone. This is an amount that startup companies cannot afford to lose, hence investing in the right data management system is a must. Minimizing information collected from your target market can also lower risks and allows you to manage data better. Another vital step you should take is to create a policy among your employees that keeps company, employee, and customer-related information confidential. Limit those who have access to sensitive data and make sure that you can trust them. Many companies also suffer the consequences of internal data breach, so it always pays to take data privacy seriously—even before launching your startup.

Data protection and privacy mirrors your brand. A startup’s brand reputation is critical during its early years along with product development, capital, and strategies. Today’s Millennials and Generation Zers comprise 48% of the total media audience who are more inclined to give their trust and confidence to brands that practice transparency. Letting your consumers know how you protect their privacy and information can elicit positive reviews online and generate more leads. Younger consumer groups are also savvy when it comes to privacy settings and can easily shut out marketing pop-ups from their phones which might steal private information from them. Minimizing the information that you need from them and guaranteeing data security will let them remember you as a trustworthy brand.


Be keen on standards. Startup companies usually impress their target markets by attaining rapid growth. However, one lapse in data security can nullify all efforts and render the business vulnerable—a major turnoff among consumers. At present, there is no single data protection law in the United States that covers all threats that companies experience. But with such large-scale data breach cases that have victimized companies like Adobe Systems, AOL, eBay, Apple, and Facebook, startups are now investing more on data management systems than quick returns. Once you incorporate a data management system in your operations, make sure you keep it up to date as cybercrime continues to evolve. Review the many security vendors and programs out there and use the right fit for your data management needs. There are also some reliable third-party providers you can hire to help minimize risks and keep you abreast of the latest technological developments.


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