Venture capital firms pride themselves on backing bold innovation. But in 2025, one area is still overlooked in too many term sheets and board decks:
🛡️ Cyber insurance.
Startups face growing challenges in securing affordable, meaningful cyber cover. Premiums are rising, exclusions are tightening, and claims are being rejected due to unclear risk postures.
As an investor, your job doesn’t stop at funding. You can help founders unlock better insurance outcomes — protecting the portfolio, your returns, and the path to exit.
Why Cyber Insurance Matters for Startups
📉 Ransomware recovery can cost more than the last funding round
📜 Many enterprise customers now require proof of cover to sign contracts
🔐 Insurers are increasingly the “cyber enforcers” — demanding controls, evidence, and frameworks
📊 Poor insurance can slow M&A or affect valuation
If cyber cover is inadequate, your portfolio companies (and their cap tables) are exposed.
The Startup Insurance Struggle
Startups often:
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Lack clear documentation of controls
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Can’t show evidence of patching or scanning
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Use shared infrastructure with unclear boundaries
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Work with suppliers that haven’t been vetted
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Fail to disclose incidents early due to fear of investor reaction
This leads to:
🚫 Rejected applications
📈 Inflated premiums
❌ Claims that get denied when things go wrong
What VCs Can Do to Help
✅ 1. Start the conversation early
Ask about cyber cover during Series A (or sooner). It signals that risk maturity matters.
✅ 2. Include cyber readiness in data rooms
Encourage founders to track patching, access controls, and security training logs.
✅ 3. Recommend minimum baselines
Cyber Essentials, MFA, and basic scanning go a long way toward insurer confidence.
✅ 4. Use group power
Negotiate favourable terms across your portfolio via shared brokers or partners.
✅ 5. Educate boards
Founders and NEDs should understand what the policy covers — and what it doesn’t.
How Cyber Tzar Supports Smarter Insurance Outcomes
Cyber Tzar helps portfolio companies:
✅ Scan infrastructure to identify exposure
✅ Generate reports aligned with insurer questionnaires
✅ Benchmark against peers and insurer expectations
✅ Improve controls with minimal engineering effort
✅ Reduce premium volatility and improve claims defensibility
We turn cyber risk into insurable clarity — and help you build resilience into your investments.
💼 Want your portfolio to get smarter cyber cover?
Start with a VC portfolio scan at cybertzar.com
