Starting a Web Hosting Business, part 1

Starting a Web Hosting Business, part 1

Running a web hosting business can be a very profitable andsuccessful business, but it is not a get-rich-quick scheme. You will need todevote a lot of time into your business to make it successful. In this part 1 ofStarting a Web Hosting Business, we will cover your business plan, inwhich you will lay out the different aspects of your business.

You will need to know how you will be hosting your clients.I recommend starting out with either a reseller plan or VPS, and as you grow,eventually move up to a dedicated server. One limitation of a reseller plan isthat you cannot sell reseller accounts. You need root access to the server todo that, which requires a VPS (virtual private server) or a dedicated server. Formost hosting startups, a $20-30 a month reseller plan is fine to start. If youwant to sell reseller plans, you can get a VPS starting at about $40-50 amonth. There are many different providers out there, I recommend using Googleto find hosts and then looking for reviews on them at WebHostingTalk.com.

Now, I am going to compare reseller plans, VPS, anddedicated servers.

Reseller plan:

A reseller plan is the cheapest way to start your hostingbusiness, but with the most limitations. If you don’t have much money toinvest, I’d recommend getting a reseller plan from a reputable provider. Don’tgo with the company with provides the most for the lowest price, because theyare simply overselling and crowding their servers, and you will pay for it inoverall performance.

VPS:

VPS is an abbreviation for virtual private server.Usually, a reseller plan is more cost effective, but a VPS gives you morefreedom. You can install your own software on it, and other users can’t slowdown the performance. One strong advantage is that you can sell reseller plansto your customers.

Dedicated server:

A dedicated server is the most cost effective (what youget vs. what you pay for,) and offers the most flexibility, butcosts the most. You also need to consider management costs if you cannot manageit yourself. You can sell reseller plans, which is another big advantage, aswell. Pricing starts at about $150 for a server that is suitable for hostingwebsites. You can get servers for less, but I wouldn’t recommend them forhosting websites, as they aren’t powerful enough. Dedicated servers aren’talways the best for start-ups, unless you have some money to invest.

Choosing how you will be hosting your clients is animportant step that I recommend looking carefully at.

Once you know how you will be hosting your clients, you willneed to look at support. Are you going to be running it by yourself, running itwith a partner, with employees, or are you going to outsource? If you are running it all by yourself, youwill need to dedicate a lot of time into answering your support tickets, whichcan very time consuming. If you have a partner, you can both answer supporttickets, which results in faster result times for your clients. You could alsohire employees to deal with sales and support tickets, but you will need tohave the money to hire. Another popular solution is to outsource your support.There are companies that you can pay per-ticket, per-client, or per-server.This is popular for growing companies who don’t have the money to hire theirown employees.

Now, we’re going to look at customer management. There arequite a few programs out there that can be used to accomplish this. You want tofind a program that handles customer signup and billing. Three of the popularones are ClientExec, ModernBill, and WHMAutoPilot. These are scripts that youinstall and run off of your server. None of these are free, but there aredifferent ways you can pay for them. You can buy an owned license, where youpay for it all at once, or a leased license, where you pay for it monthly.

That wraps up part 1 of Starting a Web Hosting Business.In part 2, we will cover advertising and marketing your new company.