In-House IT

Key Takeaways

• Over 89,000 UK startups launched in Q1 2025 alone, highlighting the urgent need for scalable, secure, and cost-effective IT infrastructure from day one.
• Managed Service Providers (MSPs) offer UK startups predictable IT costs, 24/7 cybersecurity, and expert support: often at 50–60% lower cost than hiring in-house IT teams.
• In-house IT teams offer more control and cultural alignment, but they come with high recruitment, training, and salary overhead, making them more viable for post-Series B startups.
• UK-based MSP services by Fortray empower early-stage startups with GDPR-ready, AI-enabled, and scalable IT solutions, perfect for growing securely in a hybrid work world.

The startup ecosystem in the United Kingdom is booming, with over 89,515 new ventures launched in Q1 2025, up 2.8% from the same period last year. But as these ambitious ventures scale, one big question arises: Should we build an internal IT department or partner with a Managed Service Provider (MSP)?

From cybersecurity and cloud management to helpdesk support and software integration, having the right IT setup can make or break your scalability. Budget constraints, talent shortages, and rapid digital demands make this decision even more critical for UK startups.

This blog breaks down the pros and cons of MSP vs in-house IT, explores real cost implications, and helps you choose the best strategy to support the long-term goals of your startup!

UK Tech Startups: The 2026 IT Landscape

In the United Kingdom, 7 in 10 startups report tech infrastructure as a top scaling challenge, despite a $1.2 trillion ecosystem. The stats further say:

• Over 43% of SMEs experienced a cyberattack in the last 12 months (Source: GOV.UK)
• £315 per minute is the estimated cost of unplanned IT downtime, translating to £12,000 per minute (£0.75 million per hour) in lost productivity and revenue (Source: Pingdom)

The startups are also facing:

• IT talent shortages (17,000+ vacancies in cybersecurity alone)
• Budget limitations, especially in pre-Series A and B stages
• Compliance pressure under GDPR, ISO 27001, and the upcoming CS&R Bill

With ever-increasing cybersecurity threats, a 20% YoY rise in GDPR fines, and AI tools creating new security blind spots, it is non-negotiable to have a resilient, flexible IT backbone.  

What Is an MSP?

Managed Service Providers (MSPs) are third-party IT partners that remotely manage your infrastructure, systems, and cybersecurity. In 2026, MSPs are becoming the go-to solution for UK tech startups looking to scale securely and cost-effectively. Their typical services include:

• 24/7 network and endpoint monitoring
• Cybersecurity as a service, including threat detection and compliance (e.g., GDPR, CS&R)
• Remote IT helpdesk and user support
• Cloud migration, Microsoft 365, and Google Workspace management
• Backup and disaster recovery solutions

Most MSPs offer a monthly retainer model, allowing startups to scale services up or down without committing to full-time hires. This makes them ideal for lean teams in pre-seed, seed, and Series A stages.

Recommended Reading: What are Managed IT Services?

What Does In-House IT Offer?

In-house IT refers to a team of employees hired directly by the company to manage and maintain all technology systems. These roles typically include:

• General IT support staff or IT managers
• Cybersecurity leads (in larger or well-funded startups)
• Infrastructure or DevOps engineers

This model provides startups with greater control and real-time collaboration with their tech team. It can be ideal for businesses with highly specific systems or custom security policies.

However, building an internal team means higher overheads—including salaries, benefits, training, and equipment—making it less feasible for early-stage startups.

Cost Comparison: What UK Startups Really Pay

Here’s a realistic breakdown for 2026:

Service Type	Estimated Monthly Cost (UK)	Notes
MSP (Startup Package)	£1,500 – £4,000	All-inclusive support for up to 50 users
In-House IT Hire	£4,500 – £7,500	Salary for 1–2 IT staff, excluding tools/software
Cybersecurity Software	£500 – £1,200	Required in both models
Compliance Tools	£500+	More expensive for DIY/in-house teams

For early-to-mid-stage startups, MSPs are often 50–60% more cost-effective, with fewer hidden expenses and predictable billing.

MSP vs In-House IT: Pros & Cons for Startups

Advantages of Using an MSP

• Lower upfront costs: No need to hire, train, or purchase expensive software licenses.
• Scalable support: Add or reduce services as you grow.
• 24/7 monitoring: Avoid burnout or after-hours emergencies for internal teams.
• Built-in compliance: Many UK MSPs offer GDPR, ISO 27001, Cyber Essentials, and CS&R-readiness.

Limitations

• Less on-site presence unless specifically arranged
• May lack the full context of the company culture or processes
• Risk of poor service without strong SLAs

Advantages of In-House IT

• Full control over processes, tools, and culture
• Immediate access to IT support (physically present)
• Easier for internal collaboration and fast pivots

Limitations

• High overhead and recruitment burden
• Skills are often limited to what one person/team knows
• Not scalable without major investment

Which Is Better for Scaling Startups in the UK?

Choose an MSP, if:

• You’re under 100 employees and growing quickly
• You need round-the-clock monitoring and security
• You want to control costs without compromising service quality
• You’re operating in regulated industries (finance, health, legal, etc.)

Choose In-House IT, if:

• You have stable funding and a large user base
• You require bespoke infrastructure or DevOps
• You’re building proprietary platforms that need constant internal oversight

Hybrid Models are also emerging! Some startups use MSPs for infrastructure and security, while hiring a single in-house IT manager for user support and strategy.

Recommended Reading: SLA Secrets: What to Ask Before Signing an MSP Contract

Conclusion: What Makes the Most Sense?

For scaling UK startups in 2026, the decision between MSP vs in-house IT isn’t one-size-fits-all — but for most early- to mid-stage firms, Managed IT Services deliver superior value, security, and flexibility.

With predictable monthly costs, 24/7 coverage, and instant access to cybersecurity, cloud, and compliance experts, MSPs are enabling ambitious startups to scale faster, without compromising resilience or burning through budget on in-house teams.

Fortray, being a UK-based Managed Service Provider, delivers end-to-end IT solutions designed for startups, from co-managed support to fully outsourced infrastructure. If you’re navigating GDPR, deploying AI tools, or securing remote teams, our flexible MSP model aligns with your growth stage and risk profile.

Frequently Asked Questions (FAQs)