Should You Hire an IT Person or Stay Outsourced? An Honest Framework

The wrong way to think about this question

Most small business owners frame this as "outsourcing is cheaper at small sizes; hiring is cheaper at scale." That's roughly true but misses the actual decision criteria. The real question isn't cost - it's about what kind of IT work your business needs and how predictable that work is.

Get that right and the cost picture follows.

What outsourced managed IT is actually good at

Outsourced managed IT (a provider like ours, or any of the dozen others in your country) is genuinely better at:

• Breadth of expertise. One provider has hands-on experience with M365, Google Workspace, Acronis, 1Password, Intune, multiple firewalls, multiple compliance frameworks. No one IT hire has all of that on day one.
• Tooling and process. Established providers already have monitoring tools, backup infrastructure, ticketing systems, and documented playbooks. A first IT hire needs to build all of that.
• Coverage during absence. Holidays, illness, parental leave - covered. A solo IT person creates a single point of failure.
• Buying power. A provider managing 50 small businesses negotiates better Microsoft pricing, gets faster Microsoft support escalation, and gets early access to product roadmaps.

What an in-house IT person is actually good at

In-house IT (whether a dedicated hire or a hybrid role) is genuinely better at:

• Deep business context. They sit with your team, attend your meetings, and understand your industry. A provider knows your systems; an in-house person knows your business.
• Speed for small things. "My screen is flickering" is solved in 5 minutes by someone in the office, vs a ticket for a provider.
• Cross-functional integration. Connecting your IT to your specific operations workflows, accounting systems, or industry-specific software is much easier with someone who lives the business.
• Ownership of internal processes. Onboarding playbooks, internal documentation, training materials - these benefit from a permanent person who maintains them.

The honest cost comparison

One correction to make before any comparison: salary is not the cost of a hire. Employer social contributions and other non-wage costs add a substantial share on top of gross pay across Europe^[1], and Israeli wage benchmarks need the same treatment^[2]. Fully loaded, an in-house hire is typically 1.3-1.5 times the headline salary before you account for cover during absence.

For a 25-person business in Israel and across Europe:

Outsourced managed IT is one line: EUR 2,000-3,000 a month, all-in, covering licences, security, backup, support, monitoring, vendor management and projects under a certain size. An in-house hire is four lines, and only the first one gets quoted.

That's roughly 2-3x the cost of outsourcing for a 25-person business. The breakeven point - where in-house starts to make financial sense as your only IT - is generally around 60-80 people, depending on your industry's complexity.

The hybrid model (often the right answer)

For most growing small businesses, the cleanest path isn't either/or - it's outsourced + a non-IT person who owns the IT relationship internally. This typically means:

• Your office manager, head of operations, or COO owns the IT relationship from your side
• An external managed IT provider handles all technical work
• The internal owner spends maybe 4-6 hours a week on IT-related coordination
• This works cleanly until you're around 50-80 people

When you do hire your first dedicated IT person - typically around 50-80 people - keep the managed IT relationship for the first 6-12 months while they get up to speed. Don't replace your provider on day one of the new hire's job.

When in-house clearly wins

Some specific situations where hiring beats outsourcing earlier than the cost numbers suggest:

• You build software products with regulatory requirements. Fintech, medtech, or government-adjacent SaaS often need someone embedded who understands both the product and the compliance regime.
• You're a target for sophisticated attacks. Some industries (defence, finance, certain professional services) need a security person on staff, not one on call.
• You have unusual operational technology. Manufacturing floors, broadcast systems, scientific instruments - these need specialist hands that managed IT generalists don't have.

When outsourcing clearly wins

And the inverse - situations where outsourcing is the obvious right answer regardless of size:

• You're under 25 people. The math just doesn't support a full-time IT hire.
• You operate across multiple countries with the same team. A provider with multi-country regulatory experience beats hiring one person who has to learn three regimes.
• You need predictable monthly costs. A managed contract is a fixed line item; a dedicated hire's salary and unpredictable hardware/license costs are variable.
• You can't afford to lose IT continuity for a single person's holiday. A solo hire creates risk; a provider has team coverage.

How to decide

Walk through these questions, in order:

1. 1Are you under 25 people? → Stay outsourced.
2. 2Are you in a regulated or technical industry where specialist context matters? → Consider hiring earlier.
3. 3Are you between 25-60 people with predictable IT needs? → Hybrid model: outsource + internal owner.
4. 4Are you 60+ people? → Hire your first IT person, keep the provider for 6-12 months overlap.
5. 5Are you 100+ people? → Build a small in-house team, retain a provider for specialist projects.

There's no universal right answer. There is a right answer for your business, and it usually emerges clearly from these questions.