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GDPR Compliance for Startups

Startups absolutely need to be GDPR compliant if serving the European Union. Here’s how.
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GDPR Compliance for Startups

Startups and small software companies tend to need a bit of help managing their compliance infrastructure and planning. It certainly makes sense why– as a smaller or newer business, it’s easy to fall behind when it comes to compliance. However, GDPR compliance is absolutely vital for tech companies that are considered relevant entities under the GDPR. 

In this guide, we’ll break down everything startup decision-makers and frontrunners need to know about ensuring their new business is compliant with GDPR regulations, so they can enter into their respective industry without the worry of non-compliance penalties.

What is the GDPR?

The GDPR establishes a set of EU-wide regulations for the protection of digital personal data linked to online or offline activity. Importantly, these requirements apply to EU internet users' personal data regardless of the location of the company that holds it. The norms have substantial extraterritorial reach in this regard.

This rule supersedes Directive 95/46/EC, often known as the Data Policy Directive, which sets an objective for all EU nations to achieve. Individual member states implemented national laws to achieve the directive's intentions, resulting in a tangle of regulations. The GDPR was designed to standardize such requirements while allowing individual member states to make decisions on a number of aspects. There is flexibility in data processing, for example, in terms of how companies may verify GDPR compliance, data transfer beyond the EU, and media freedom.

Personal data is defined under the GDPR as information about an identified or identifiable natural person. IP address, device ID, and customer reference number are all examples of personal data. Importantly, these safeguards apply to all business organizations that process EU individuals' personal data, even if the relevant data is processed outside of the EU. Transferring personal data outside of the EU is likewise restricted under the regulation.

Personal data may only be transferred outside the EU if the European Commission determines that the receiving jurisdiction provides an adequate level of protection in accordance with the GDPR, the processing entity has implemented appropriate safeguards, or the individual has given specific consent to the transfer. In addition, the GDPR provides EU internet users with a number of privacy rights, including "mandatory, prompt notification of data breaches likely to result in a risk to individuals' rights and freedoms," "access to one's personal data," "the ability to instruct an entity to erase one's personal data," and "the ability to move one's personal data from one processing entity to another." These rights, taken together, are at the heart of the regulation's goal of restoring citizens' sovereignty over their personal data.

This might seem a bit intimidating. However, GDPR compliance is actually quite simple, especially if a compliance plan is implemented early on in the organization’s startup stage.

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Why Do Startups Need to Focus on GDPR Compliance?

If you're a startup, the GDPR should prompt you to consider how you manage your data in a transparent, responsible, and accountable manner, demonstrating and verifying that you've implemented the appropriate processes to protect user data. This rule encourages us to pay attention to the indisputable truth that we are accountable for people's data and makes us think about and design the data lifecycle in a simple and responsible manner, at a time when iterative development is becoming increasingly popular. This is especially important for new businesses since it allows them to establish trust and make it a part of their branding.

The Basics of GDPR Compliance for Startups

To be GDPR compliant, entrepreneurs must take a few critical actions. Fortunately, regardless of legal compliance, these processes are simple and advantageous to the organization.

1. Begin by mapping out your data.

What's the source of your data? And, most crucially, what kinds of information are you gathering? Understanding the origins of your data is essential for GDPR compliance and the development of a good privacy strategy. The next elements of this checklist are significantly reliant on your website's ability to identify which cookies it gathers. As a result, one of the first tasks we propose is doing a website assessment.

2. Make a decision on who will be your DPO.

It is recommended to select a Data Protection Officer as soon as possible since it will steer you in the proper direction and provide structure. You can either select a DPO from inside your company or engage a third-party contractor.

3. Keep your data acquisition to the minimum.

This is beneficial to your business for a multitude of reasons. Once you've determined which data you gather and why, be sure to evaluate and remove superfluous data on a regular basis. Develop marketing techniques that rely less on sensitive user data or data from other parties. This may be accomplished by putting in place a mailing list marketing plan.

4. Get your data processing agreements out of the way as soon as possible.

A data controller is an individual person or specific entity that is responsible for deciding the objectives and means of collecting or processing personal data under the GDPR. The majority of companies are data controllers. You must have a Data Processing Agreement in place before transferring any personal data to a data processor. This is a contract that specifies the extent of your data-sharing agreements and assures that the data processor treats any personal data received from your firm with care.

5. Become a member of your local Data Protection Authority.

These are independent privacy regulators who may provide firms with data protection advice and are in charge of levying fines for GDPR violations. Your Data Protection Authority may require you to register and pay an annual fee.

6. Make a privacy policy for yourself.

The GDPR makes it mandatory to develop a privacy policy. Your Privacy Policy explains how and why you process personal data, as well as how people may exercise control over such processing. Your Privacy Policy must at the very least include your company's contact information, a list of the types of personal information you process, an explanation of why you're processing it, a list of the types of third parties with whom you share personal information, and an explanation of your legal basis for processing each type of personal information. Explain your international data transfer precautions and how individuals can use their GDPR data rights if you move personal data outside of the EU. Include your Data Protection Authority's contact information as well. Your Privacy Policy is a living document that must be updated on a regular basis.

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