The Cost of Doing Nothing in Cybersecurity for SMBs

When it comes to cybersecurity, many small and midsize businesses (SMBs) tell themselves: “We’re too small to be a target.” Unfortunately, attackers think differently.

Hackers now view SMBs as prime opportunities, easy to breach, slow to detect, and expensive to recover. And while investing in security might feel like a cost, the real expense comes from doing nothing.

The Real Cost of Ransomware

Cyberattacks don’t just cost the ransom. They drain resources in recovery, downtime, lost clients, and reputation damage.

What “Doing Nothing” Really Costs

Let’s break down the real numbers:

• Downtime Costs Thousands Per Hour: A single ransomware incident can shut down operations for days. Industry research shows SMBs lose an average of $8,000 per hour of downtime in lost sales, stalled projects, and frustrated clients.
• Recovery Expenses Stack Up: Beyond downtime, recovery costs include ransom payments, IT remediation, legal fees, and possible regulatory fines. The average recovery bill for SMBs is now over $50,000, often unbudgeted and devastating.
• Lost Trust & Reputation: Even if you recover your data, clients and partners may not stick around. For many SMBs, a breach isn’t just a tech failure; it’s a business reputation failure.
• Business Closure Risk: Studies show 60% of SMBs close within six months of a major cyberattack. It’s not scare tactics, it’s math. The financial hit and loss of confidence can simply be too much to overcome.

Here’s what the numbers look like:

Average Ransom Demands by Industry (U.S.)

• Retail, Restaurant, Hospitality: $5.7M
• Energy & Technology: $5.4M
• Finance & Insurance: $3.91M
• Healthcare: $3.49M
• Manufacturing: $3.35M
• Government: $1.58M
• Business & Professional Services: $1.13M
• Education: $960,000
• Nonprofit: $100,000

Even “lower” numbers here are devastating for SMBs that don’t have deep cash reserves.

Average Cost of Ransomware Attacks by Year

• 2019: $761,000
• 2020: $1.45M
• 2021: $4.62M
• 2022: $4.54M
• 2023: $5.0M
• 2024: $5.13M

The trajectory is clear: ransomware costs are rising, not shrinking. What used to be a six-figure problem is now a multi-million-dollar disaster.

The Hidden Costs Most SMBs Miss

The ransom demand is just the beginning. The true cost of a ransomware attack includes:

• Direct financial losses
• Employee hours spent resolving the breach
• IT + legal response teams
• Lost revenue from clients who walk away
• Higher cyber insurance premiums
• Regulatory fines for non-compliance

And beyond the dollars, there’s long-term damage: lost trust, stolen intellectual property, and difficulty securing future contracts or investments.

Why Proactive Cybersecurity is Cheaper

The good news? Proactive cybersecurity doesn’t have to break the bank. In fact, it’s one of the most cost-effective investments you can make.

• Prevention is cheaper than recovery. Tools like endpoint detection, monitoring, and penetration testing cost a fraction of what recovery does.
• Compliance is simpler. Staying ahead of regulations (HIPAA, PCI, etc.) avoids expensive fines.
• Peace of mind has ROI. When your business isn’t constantly reacting to threats, you’re free to focus on growth.

Think of cybersecurity like insurance: you don’t wait for the fire before buying coverage.

Take Action Before It’s Too Late

At Red Level, we know SMBs can’t afford enterprise-sized budgets, but that doesn’t mean they can afford to ignore cybersecurity.

Claim a free dark web scan to see what’s already out there about your business.

Then explore how Red Defender packages can give you enterprise-grade protection at a scale (and price) that makes sense for SMBs.

Cybersecurity isn’t a “someday” project. It’s a right now decision. The cost of doing nothing is too high and for SMBs, it can be the difference between thriving and closing your doors.
With the right partner, proactive protection is within reach. Don’t wait until after an incident to realize the actual cost of inaction.