Every growing company in California eventually hits the same fork in the road. The technology has outgrown “the person who is good with computers,” things are breaking more often, and someone in leadership finally asks the question: do we hire IT, outsource IT, or something in between?
Most articles answer this with vibes. Let us answer it with math, using real California numbers, and then talk about the part of the equation that spreadsheets miss.
Option 1: Hiring in-house
Start with the true cost of one IT hire, because it is always more than the salary line.
A systems administrator earns a median of roughly $97,000 nationally, and in California’s major metros you should expect meaningfully more, often $110,000 to $135,000 for solid experience in Los Angeles or San Diego, and higher in the Bay Area. Add 25 to 30 percent for benefits, payroll taxes, and overhead, plus the tools they need to do the job (monitoring software, ticketing, security tooling, backup licensing), and one mid-level hire realistically costs $140,000 to $175,000 a year in California.
Now the parts the spreadsheet misses. One person cannot be an expert in everything, so you get one skill set covering networking, cloud, security, and helpdesk, which are genuinely different disciplines. One person also takes vacations, gets sick, and eventually resigns, and when they do, every password and undocumented quirk of your environment walks out the door with them. And one person cannot watch anything at 2 a.m. There is no such thing as a one-person 24/7 operation.
In-house starts to genuinely make sense at scale. The common break-even is somewhere around 150 to 200 employees, and even then most companies keep a hybrid model rather than going fully internal.
Option 2: Fully managed IT services
With a managed service provider, you pay a flat monthly fee, most commonly per user. Across the US in 2026, comprehensive managed IT runs roughly $100 to $250 per user per month, with small businesses typically landing between $100 and $175 and mid-sized companies between $150 and $250. California’s coastal metros price toward the upper part of those bands, because MSP pricing tracks local wages.
Run the math on a typical 25-person California company at $175 per user: about $4,400 a month, or roughly $52,000 a year. That is around a third of the true cost of one in-house hire, and what you get for it is not one person. You get a whole team’s coverage: helpdesk, engineers, security monitoring, and, with a security-led provider, a 24/7 Security Operations Center that never takes a vacation.
Two honest caveats. First, watch the quote quality. Per-user pricing below about $80 almost always means something important is excluded, usually the security tooling, after-hours coverage, or onsite support. Second, watch the exclusions in general, because out-of-scope charges at some providers can quietly inflate a bill 30 to 50 percent past the headline number. The cheapest quote is very often the most expensive relationship. We wrote a whole guide on the questions that expose this.
Option 3: Co-managed IT
Here is the option most companies do not realize exists, and it is the fastest-growing model for a reason.
Co-managed IT means your internal IT person or small team stays, and a provider works alongside them. Your internal staff keeps doing what they are great at, usually the day-to-day support and the institutional knowledge, while the provider supplies the things one person cannot: 24/7 monitoring and security operations, deep specialist expertise for projects, coverage for vacations and turnover, and enterprise tooling your company could never justify buying alone.
Cost-wise, co-managed typically prices below fully managed on a per-user basis because the provider is not carrying the entire load. For a company that already employs an IT manager, adding co-managed support often costs a fraction of a second hire while covering the gaps a second hire still would not fix, like around-the-clock security monitoring.
If you have ever thought “we cannot use an MSP, we already have an IT guy,” co-managed is the answer to that exact sentence. It is also, quietly, the best retention tool for your IT employee, who stops being on call every weekend of their life.
The comparison in one honest paragraph
For a California company under roughly 150 employees with no internal IT, fully managed is almost always the strongest economics: team-level coverage for less than half the cost of one hire. For a company with an internal IT person who is drowning, co-managed usually beats hiring a second person on both cost and coverage. And in-house-only makes sense mainly at real scale, or in unusual environments, and even then usually with outside security operations behind it, because the 2 a.m. problem never goes away.
One more factor that does not show up in salary math: risk. A single hour of downtime costs mid-size firms six figures by most industry estimates, and breach costs run into the millions. Whichever model you pick, the version of it that includes real security monitoring is the one actually protecting the number that matters.
Where we fit
CyberDuo delivers both models. Our fully managed IT services act as your complete IT and security department, and our co-managed engagements back internal IT teams with our in-house 24/7 SOC and specialist bench. Either way, cybersecurity is the foundation, not an add-on, which matters most for regulated companies in healthcare, financial services, and law firms.
We support companies across California, with local teams serving Los Angeles, Orange County, and San Diego. If you are standing at this fork in the road, reach out. We will run the actual numbers for your headcount and tell you honestly which model fits, including when the answer is keeping your internal person and backing them up.