As the volume and sophistication of cyber threats and risks grow, cybersecurity has become mission-critical for businesses of all sizes. To address this shift, SMBs have been urgently turning to vCISO services to keep up with escalating threats and compliance demands. A recent report by Cynomi has found that a full 79% of MSPs and MSSPs see high demand for vCISO services among SMBs.
How are service providers scaling to meet this demand? Which business upside can they expect to see? And where does AI fit in?
The answers can be found in “The 2025 State of the vCISO Report”. This newly-released report offers a deep dive into the vCISO market evolution and the broader shift toward advanced cybersecurity services. The bottom line? What used to be a niche offering is now a foundational service, and AI is transforming how it’s delivered. Below, we bring some of the main findings of the report.
319% Growth in vCISO Adoption: MSPs & MSSPs Race to Meet SMB Demand
vCISO offerings provide a flexible, cost-effective way for organizations to access high-level cybersecurity expertise without the overhead of a full-time executive. And with a growing number of attacks alongside the growing awareness of the importance of cybersecurity, it’s no surprise that demand for vCISO services is skyrocketing among SMBs. Demand for vCISO services is outpacing even compliance readiness and cyber insurance support.
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| Figure 1: Demand for Advanced Cybersecurity Services Among SMB Clients |
In response, adoption of the vCISO offering among MSPs and MSSPs has jumped from 21% in 2024 to 67% in 2025. This is a 319% increase in just one year. In addition, 50% of the service providers who don’t yet, plan to launch vCISO offerings by year’s end. This adoption curve reflects a clear industry shift, from vCISO being a niche service to becoming a core one.
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| Figure 2: Plans for Offering vCISO Services |
Real Business Impact: Higher Margins, Better Upsell, More Recurring Revenue
The growth in adoption isn’t just driven by client demand. It’s also underpinned by strong business outcomes for providers. Organizations that offer vCISO services report substantial gains:
- 41% report an increase in upsell opportunities, leveraging vCISO for additional service offerings
- 40% see improved operating margins
- 39% report a measurable expansion in their customer base, including access to new prospects
And of course, vCISO services offer significant security benefits to clients. From the service provider angle, leading security expertise elevates them beyond mere temporary vendors to trusted, long-term strategic partners.
Adoption Barriers Are Real, But They’re Operational, Not Strategic
While enthusiasm among service providers is high, not every provider has yet made the leap into vCISO services. Among those still in planning mode, the report identifies three primary concerns:
- 35% cite uncertainty around profitability or ROI.
- 33% highlight high upfront investment requirements.
- 32% point to a shortage of qualified cybersecurity professionals.
Importantly, few providers doubt the market demand or business value of vCISO services. Instead, they’re struggling to implement them efficiently and profitably.
This is where technology and automation come into play. As AI-powered platforms reduce manual effort and enable scalable service delivery, the operational burden becomes far more manageable, opening the door for broader market participation.
AI Is Reshaping the vCISO Delivery Model
AI is no longer a future consideration. It’s already having a profound impact on how vCISO services are delivered. According to the report, 81% of MSPs and MSSPs are already using AI or automation within their vCISO workflows, and an additional 15% plan to adopt it within the next year.
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| Figure 3: Use of Automation and AI Tools in vCISO Service Delivery |
The applications of AI in vCISO services are wide-ranging and impactful: reporting automation and insights, remediation planning, compliance readiness and monitoring, risk and security assessments, task prioritization, and more.
The result is a significant reduction in manual workload: an average decrease of 68%, with 42% of providers seeing 81–100% workload reductions in some areas.
This allows service providers to support more clients, deliver higher-quality outputs, and improve profit margins, all without expanding headcount. In effect, AI is enabling the kind of scale and consistency that traditional, human-led delivery models could not sustain.
The Road Ahead: AI-Driven Scale, Strategy and Service Differentiation
The 2025 State of the vCISO Report paints a clear picture: As service providers continue to invest in automation and intelligent tooling, the vCISO model will shift from resource-heavy to AI-powered and highly efficient.
Looking forward, we expect to see:
- Wider market penetration among MSPs and MSSPs
- Deeper integration of AI across vCISO services
- Higher ROI, as service providers implement AI and other technologies in their processes and offerings.
For a complete view of trends, benchmarks, and best practices shaping the future of virtual cybersecurity leadership, download the full 2025 State of the vCISO Report.
