From Endpoints to Apps: The Security Gap MSPs Must Close

Managed Service Providers (MSPs) have long served as the backbone of IT for small and mid-sized businesses. But as customer expectations evolve and cyber threats grow more complex, MSPs are finding it harder to stay profitable and relevant.

The traditional model—offering reactive support, endpoint protection, and monitoring—no longer guarantees growth. Today’s clients want more: proactive security, compliance support, and visible business outcomes.

One critical area where MSPs fall short is application security. As threats targeting web applications and APIs surge, clients expect protection beyond infrastructure—but many MSPs don’t offer this capability, leaving a significant gap in their value proposition.

In this blog, we explore seven major forces reshaping the MSP landscape—and how forward-thinking MSPs are adapting to not just survive, but thrive.

7 Security Gaps MSPs Can’t Ignore

1. The Margin Squeeze Is Real

MSPs are under relentless price pressure. With IT services increasingly commoditized and clients demanding more for less, operational overheads are rising while margins shrink. Add the cost of 24/7 support, specialized staffing, and tool sprawl, and it becomes clear: scaling profitably is no longer straightforward.

2. Growth Isn’t Just About Adding Clients

Customer acquisition is expensive. Upselling, meanwhile, is limited when most services offered are viewed as hygiene rather than high-impact. In a landscape where nearly every MSP offers “monitoring and patching,” the real differentiators are the outcomes you can deliver, especially in the realm of security and compliance.

3. Clients Expect More Than Just Support

Today’s SMBs are more cyber-aware—and risk-averse—than ever. They want to know their applications and APIs are secure, not just that their endpoints are patched. But providing that level of protection requires expertise, visibility, and time MSPs don’t always have.

4. Compliance Has Become a Shared Burden

It’s no longer just the client’s job to be audit-ready. Vendor risk assessments and third-party audits are pulling MSPs into the compliance conversation. And it’s no longer enough to say “we secure your systems”—you need to prove it with evidence, timelines, and closed vulnerability reports.

5. Tool Sprawl Creates Hidden Costs

Many MSPs are cobbling together solutions—one for scanning, another for remediation, another for reporting. This fragmented approach creates inefficiencies, limits visibility, and often ends up adding more work without adding more value.

6. The Skills Gap Isn’t Going Away

Web and API security require deep expertise. But the kind of talent that can deliver it is expensive and hard to retain. This gap increases risk—not just for clients, but for MSPs themselves, who may be held accountable in case of a breach.

7. Limited Visibility into Client Risk Posture

Many MSPs lack the tools or integrated dashboards to offer clients a unified view of their security and compliance health. This lack of visibility limits the ability to have strategic conversations, proactively address issues, or upsell premium offerings. Clients increasingly expect transparency—not just alerts, but insights they can act on.

The Way Forward: Simplicity, Proof, and Outcomes

MSPs that succeed over the next decade will do so by simplifying operations, proving value through clear outcomes, and offering services that directly impact their clients’ security posture and compliance readiness.

Platforms like Indusface are helping MSPs bridge that gap—not by adding another tool, but by providing a fully managed, all-in-one AppSec platform that enables:

• Zero-cost vulnerability scanning for lead generation
• Remediation bundled into service plans for fast upsells
• Clean, compliance-ready reports for audits
• Protection across web apps and APIs
• AI-powered automation with human verification to eliminate false positives
• High-margin services without the need for in-house security teams

In short: less noise, more proof. Less overhead, more growth.

Conclusion: A New Mandate for MSPs

The expectations have changed. Clients want a partner who can keep them secure, help them stay compliant, and make that value visible. The MSPs who embrace this shift—from support provider to strategic security partner—will lead the next wave of growth.

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