Starting a hosting business

Hi, I am a freelance designer/ developer and have an unlimited reseller hosting package. I use it for my web design clients at the moment but am thinking of offering hosting as a service in itself.

  1. Do you have any advice on package sizes - e.g. bandwith, server space, prices?

  2. Do you have any advice on offering support? E.g. should I offer 24/7 support, or a reply within 24 hours? What trustworthy companies are out there who I could outsource support from, and how much should I be looking to pay?

Thank you

My advice would be that there are better ways to make money…

If you want to be a true web host, that requires lots of capital, and risk and work.

It sounds like maybe you are talking more about “managing” people’s websites - being a system administrator.

If that is the case, then maybe that’s not so bad.

Still, even with that, I’d focus on making money building and supporting websites, and leave the hosting to someone else.

Just my 2-cents.

Thanks for your reply. My thinking was that as I am paying for the reseller package anyway, it would be a good way to make some extra cash. But maybe it’s more work than I anticipate?

When I think of “web hosting” I think of the people who own the servers and the data lines and the data centers. (I would never want to do that!)

I suppose if you buy a VPS and host people’s websites on your virtual server you could be considered a “web host”.

I dunno.

To me there is more money and fun to be made and less headache in designing and building websites than maintaining them. (Who do you think makes more money for less effort… An architect, a general contractor, or the people who maintain the building?)

If it were me I would definitely try to get repeat business on websites I build via chage requests and enhancements. But I personally wouldn’t want to be responsible for making sure my client’s website is up 24/7.

Another important consideration is WHO is your client and WHAT type of website do they have?

I would maintain a website for a church or the Girl Scouts because their needs and demands are probably less. But I would stay away from taking on an e-commerce site where you have an SLA that promises to keep it up 99% of the time. (Do you really want to have to be monitoring it when you are out on a date, or when it goes down at 3:00am on Monday morning? No me!!)

Just some thoughts…

To be honest, it’s easy when you first start out. Chances are you’ll acquire customers without many requests but when you start getting more payments and more advanced users who want Shell, or want some module or extension on the server (which is reasonable, but you don’t have at that moment) such as Ruby or other cool features and you don’t know how to use the command line on your server gets a bit tricky.

I think the best approach when starting out a host platform would be to acquire a “managed” dedicated server where you can easily open a support ticket with your server host and ask them to perform some of the tasks for you while you learn at the same time. In fact, you and your host will at some point build a relationship as you’ll be asking them to add PTR records for your customers mailers and other things like this as you move forward.

From experience, you may even want to really consider your hosting plan pricing and packages. For example, we offer a $10 / mo recurring plan without static IP and basic disk space but that price point may not work for you. You’ll get payment notices after the first month was paid that the person on the $10/mo plan skipped their payment or hasn’t paid the account in full for month two and you’re running around trying to collect your payments or inquire about the unpaid bill, sometimes never getting a reply. A lot of this can be resolved by recurring billing every 6 to 12 months, even 3 month recurring billing would be better than 1 month.

With that in mind try another approach, introducing 6 month and 1 year plans. You’ll get fewer signups but in the long run it’s worth it since you’ll collect 6 months payments in advance for a service you know that works and that the customer is happy with (hopefully) and since their payment is prepaid for 6 months you’re not running around every month for collections.

Just a thought about low price points and monthly billing. If possible, stay away from that :slight_smile: Just my opinion.

As for support, make sure you stress to your “host” that you’ll need some kind of support and if they’re okay to help then this is a good start. You shouldn’t really claim that you offer 24x7 support if you’re a one man show but your support ticket app should allow customers to submit a ticket to you anytime of the day while you strive to make a commitment of getting back to them within 2 to 12 hours (at least). Your verbiage could mention “Submit a support ticket 24x7” instead of “24 hour support”.

Our host, dedicated now IMO has world class support. Over the 5 year span we’ve been with them, after the countless command lines functions I wasn’t able to complete, they were always there never stumped at anything thrown at them. It’s really hard to move away from that service when the price is right and support never lets you down. That’s a really good trusted feeling.

Just start slow, understand your limitations and ensure that those limitations can be met with the company you’ll do hosting business with. As you progress, I trust you’ll know exactly what to do with the situations and options in front of you.

Good luck.

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Thanks for the advice. Most of that rings true. We are based in the UK.

Out of interest, has anyone had experience of bobcares.com for outsourcing support? They seem very professional but always good to get a second opinion.

Thanks

What is your objective - to establish a good web development portfolio or to provide services like web hosting and domain registration? I would suggest that you’d focus on what you do best.

The only exception would be to host your own client on your Reseller Account. But even if you do this, you’d end up spending some time, providing customer support to them. It is not your business. I guess you’d not like spending a time outside business hours, trying to fix any app or a coding issue for any customer, who decided that it was a good idea to play with any app, plugin or a piece of code and messed it up?

You’d better go find a web hosting company you;d partner with, affiliate with it and earn money for each web hosting account you bring to them. This will allow you both to earn some extra money and to focus on developing websites and applications.

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I agree with F, the amount of time you can trying to fix issues you cant control will be a nightmare.
You are usually 3 or 4 down the chain of who actually controls the servers, so often times all you are left with is dealing with irate customers when their email or website is down.

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Reselling or offering your own hosting is a business venture - treat it as such. Consider how much money you’d be making per client and remain competitive. Then consider how much time you’d potentially be spending. Most of the time, hosting or even reselling isn’t worth it on the books unless you can invest lots of time, and have lots of clients to go with that. I host a handful of my former/current development clients, but I specifically only offered that service to people who I knew would never have request, not need cPanels, would never do their own web work - acquaintances, owners of “mom and pop” sized businesses, etc. It’s a help to them, not really a money maker for me. I’d never enter the hosting business without a business plan, financial plans and projections, and lots of research.

qwerstd,

Are you willing and able to support your clients 24/7/365? If not, this is not for you.

Are you in control over your own server (reseller accounts are on shared servers with MANY clients competing for CPU use, storage and bandwidth (NOTHING is unlimited - read your T&C for the “normal use” clauses)? If not, this is not for you.

Can you offer every daemon that a user could want? Can you resolve issues with databases, storage, apps (web logs)? What would you do IF (and that’s a BIG IF) you detect a hack attack? Are you willing to take on the liability for problems that your clients may introduce (and be transmitted to other clients domains on your server)?

Web hosting is something to approach casually and, if you’re asking these questions, then you’re not capable of doing this as a professional.

Good thought but, as stated above, stick to what you’re good at (IMHO).

Regards,

DK

i would resign on 24/7, that would cost more money

Thanks all for the useful advice. I think it’s probably not for me.

It would be great if you looking for Reseller Hosting packages initially. Reseller Hosting plan with turnkey solution would a good choice. Moreover, you need to make sure that the hosting company is providing free end user support to your clients. This way with less amount of capital you can start your own web hosting business.

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