Necessity is the mother of invention. Plato’s concept rang especially true during the dot-com boom of the late ’90s and early 2000s when businesses first rushed to establish their digital presence but quickly realized they needed help managing the IT infrastructure behind it. Out of that need, Managed Service Providers (MSPs) were born.

As technology advanced, so did MSPs, becoming indispensable partners for managing networks, day-to-day IT operations, and, more recently, cloud migrations. But now, a new necessity is reshaping their role: cybersecurity.

A trifecta of pressures – rising digital threats, increasing compliance requirements, and changing client expectations – is redefining what businesses require from their MSPs. Today, security needs are the focus of every conversation.

This shift presents a challenge and a growth opportunity for MSPs. By partnering with cybersecurity vendors built for the managed services model, MSPs can meet client expectations without building solutions from scratch. This approach establishes greater relevancy and opens up new revenue streams, as 83% of organizations plan to invest more in cybersecurity in the next 12 months, with an average budget increase of 19%.

The SMB Perspective on Cybersecurity

A few years ago, threat actors viewed SMBs as not worth their time; now, they are seen as easy targets. According to a ConnectWise study, 94% of SMBs have experienced at least one cyberattack, up from just 64% in 2019. Thanks to AI, attackers can launch highly effective phishing and ransomware campaigns with minimal effort. As noted in a Microsoft report, the average cost of an attack on an SMB is $254,445 (though some incidents have exceeded $7 million), which can devastate an SMB.

Regulatory Pressure

Like enterprises, SMBs must adhere to frameworks like GDPR, HIPAA, PCI-DSS, and more. With regulations constantly changing, compliance has become a minefield; SMBs would like to turn to their MSPs for support and guidance, putting additional pressure on providers to offer security-first services.

Changing Client Expectations

Businesses want to streamline their operations, which means seeking out a single, accountable provider that can deliver IT and security services; 62% of SMBs would consider switching to a provider that offered both solutions, up from 40% in 2020. MSPs that bundle security into their core offering will retain clients and win new ones.

Why MSPs Must Evolve into MSSPs

The distinction between MSPs and Managed Security Service Providers (MSSPs) comes down to the scope and depth of services offered.

MSPs traditionally focus on:

• IT operations and infrastructure management
• Technical support and helpdesk services
• Remote monitoring and end-user management
• Network maintenance, system updates, and automation
• Cloud migration and business process optimization

For security, they provide baseline protections such as antivirus, firewalls, and patching. While important, they aren’t enough because attackers exploit the gaps between IT management and security oversight.

Consider this: while most MSPs patch systems on a schedule, a recent study found that 12% of known vulnerabilities (“n-days”) were exploited within the first day of public disclosure, 29% within a week, and 56% within a month, leaving little room for slow or scheduled responses. Patching delays create windows when no one is actively watching for signs of compromise – and that’s precisely when attackers strike.

MSSPs close that gap with real-time protection and a suite of advanced services, including:

• 24/7 security monitoring and threat detection
• Threat intelligence and proactive threat hunting
• Incident response (IR) and forensic investigation
• Compliance support
• Identity and access management
• Endpoint and network security management
• Security awareness training

SMBs need more than routine IT support. They need a partner who can detect, respond to, and proactively defend infrastructure around the clock.

The Business Case for MSPs to Add Cybersecurity Services

The rationale for MSPs to expand into security is persuasive:

New Revenue Opportunities: Security services command higher margins and create predictable, recurring revenue streams. As security budgets increase, MSPs with the right offerings can tap into significant growth.

Increased Client Retention: Bundled IT and security simplifies vendor management for clients and deepens trust and dependency, leading to longer-term contracts and lower churn.

Competitive Differentiation: Not every MSP is ready to deliver security-first services. Those that are can stand out with a clear value proposition, positioning themselves as strategic partners, not just IT fixers.

With the managed services market projected to reach $511.03 billion by 2029, the MSPs that embrace security will be best positioned to strengthen long-term profitability.

The Smart Way In: Partnering with the Right Cybersecurity Vendor

Building in-house security capabilities from scratch is expensive, complex, and resource-intensive. It requires investing in a suite of tools and specialized staff available 24/7, and scaling those capabilities is tough when MSPs are already focused on delivering core IT operations.

For most MSPs, strategic partnerships with cybersecurity vendors are the fastest and most effective route to offering enterprise-grade protection.

Here are a few must-have capabilities to look for in a vendor:

• Solutions tailored to MSPs with multi-tenant, scalable architecture
• AI-native detection and response to speed up threat identification and reduce false positives
• 24/7 SOC coverage for continuous monitoring and rapid incident response
• Fast deployment and easy integration to minimize disruption and speed time-to-value
• White-labeled support that allows MSPs to maintain branding

With the right vendor, MSPs can immediately offer the kind of security outcomes clients expect without the overhead of building a SOC or hiring a team of security analysts.

The Advantages of an MSP-Focused MDR Solution

Partnering with a SOC provider isn’t the only way forward. A next-gen Managed Detection and Response (MDR) solution furthers protection and enhances client outcomes.

Look for these key MDR capabilities:

• Hands-off Control: Automated, AI-driven threat detection, investigation, and response workflows that require minimal manual effort.
• Advanced Threat Intelligence and Rapid IR: Real-time data, behavioral analytics, anomaly detection, automated threat correlation, and fast IR that reduces the Mean Time to Respond (MTTR) and the impact of a breach.
• Compliance Support: Built-in tools and reporting features to help clients meet changing regulatory requirements efficiently.
• Scalable, Future-proof Architecture: Flexible, multi-tenant design with integrations that fit into existing MSP workflows and adapt as threats evolve.
• Proactive, Not Reactive: A product incorporating continuous, proactive threat hunting, prevention, and system hardening to reduce risk and ensure business continuity.

Evolve or Be Left Behind

Cybersecurity has become a non-negotiable part of the managed services stack. Clients expect protection, not just support.   Transitioning from MSP to MSSP isn’t about abandoning core competencies but rather enhancing them with security capabilities. The most successful MSPs of tomorrow won’t just manage IT; they’ll protect it comprehensively, creating stronger, more resilient businesses for their clients while building sustainable growth for themselves.