Even if most people will tell you “it’s an oversaturated business, don’t bother anymore”, let’s try for a second to plan such business. Even if there are so many web hosting firms around and so many services to chose from, why not try it? It’s a tough niche, but with some work and dedication you might make it really work. I have thought about this possible business too and, even if I just sell hosting to my web design clients and not work on this as a standalone business, there were some ideas that crossed my mind. I won’t be a hosting provider only because it’s not my dream niche, but allow me to offer some advice and maybe some hints I have thought about all these months.

What can I bring new in this business?

We know there are some huge hosting providers and we’d be fooling ourselves if we thought we can give them a run for their money. Even if you won’t be able to compete with the big guys, why not create a business that’s small, but still reliable and profitable in the end. Our main goal here is to earn more than we spend. Simple as that.

We are certain we can’t sit on huge datacenters with hundreds of servers and millions of clients. But this shouldn’t stop us to dream of hosting our own clients and giving them a good service for their money.

I think that your main goal should be to provide them with a good service and most important: a good personal support. Some of the big hosting companies, dealing with hundreds of clients a day, sometimes fail to make the client feel important and even helped. This is the place you can bring in your advantage: small number of clients and better support.

Here are the things you need to provide:

• excellent uptime. There’s no if or but here. Most clients complain about downtimes, you need to be able to run their sites on good servers with less chances of downtimes.
• excellent support. Don’t delay your answers. Make sure you have the time to respond to their questions or have someone help you. THIS is the area you can beat the big guys since most have way too many clients to handle them all.
• good plans and affordable prices. Don’t just offer plans you can’t cover. Sure you’d be overselling, but don’t exaggerate. Don’t promise huge plans they won’t need, just offer them a decent plan with excellent uptime and they’ll love it. And sure, we need to try to come a bit less expensive than the big guys, which we’ll discuss later in this article. And if your clients still want unlimited resources, send them to our article: Reasons for you to NOT look for UNLIMITED resources

Where can I find the hosting on my own?

Sure, in order to sell that web hosting space you need to have it. There are few possible ways to do this and we’ll discuss them all:

• start your own server. The pros would be that you have total control over it. The cons are: server price, you need to know how to configure it, protect it, the software is pretty costly, you need 24h supervision, a good internet connection (very good one that costs a lot too). Maybe at first it’s a good idea to not go to this.
• buy a dedicated server from a hosting company. With 100 USD or more you can have a dedicated server. The pros are that it’s “yours” and will be used by you as you want it, the con would be the price, a tad high for a beginner in the web hosting business.
• buy a reseller account from a good hosting company and upgrade afterwards. In my case this is what I have done. I have a good reseller plan at hostgator (after qualityhostonline.com and resellerzoom.com proved to be horrible). It costs 25 USD/month and I can host up to 200 sites.

If you have more money and think you’d develop VERY fast, then buy a good dedicated server. If not, you can use a reseller and then, when the moment comes, upgrade to another plan, dedicated this time.

Your main concern now is to MINIMIZE these expenses so that you can be on a profit as soon as possible. This is where your talent comes into play. You need to be able to foresee how fast your business will grow. It would be a pity to waste money on some resources and use 5% of them, while still paying 100 dollars a month. In case you develop too fast for the resources, you can order a dedicated and in few days it’s all set up.

If I was to open such a business in a serious manner (not just a side service as I do now), I’d still go on the reseller account. I’d use it to the max and then order the dedicated server. In this case you can provide a 3-5 USD / month plan to your clients and put 100-200 on the server. This means at least 300 USD or 1000 (if you “force” that reseller account).

Even if you make 200 USD / month you’d already earn 8 times the cost of your hosting plan. It’s up to you to decide how to manage your pricing policy or the number of servers, but it’s a good idea to make thorough calculations so that you don’t end up on a minus result. Our goal here (after providing that amazing service) is to be able to earn more than we spend on a monthly basis.

Should you feel the reseller plan idea is not that good for you and you think you’d outgrow it way too fast, then a dedicated server will do the trick.

OK, I have the hosting, what now?

Now you have to create a site to advertise your services. Use a nice design (unique) and optimize it with care. Instead of too many bells and whistles, have a beautiful design and clean code (div only would be great).

After the site is up and running, you can start advertising.

MAKE SURE YOU SET A BUDGET!

It’s very easy to get overboard with advertising. Make sure you set an advertising budget and STICK to it! You don’t want to spend way too much and not be able to develop some more. You have to think about advertising on a long period and also being able to pay for that hosting yourself. A business does have some costs, make sure you don’t end up bankrupt from the first 2 months.

How do you advertise? In all forms possible:

• AdWords campaign. Set a budget and bit for those keywords
• links and banners on some sites (discuss with the owners and get some good deals)
• promote on forums: in the market-place areas and in your signature, while posting GOOD quality messages.
• comment on related blogs. Again, good comments that will bring you some traffic and possible clients
• press-releases, article directories ANYTHING that will bring you some traffic. Put that talent to good use, create a nice article and promote it. With your link there.
• all kinds of other methods to get traffic. The idea is to get those visitors and make them stay

MAYBE A PROMOTIONAL SALE IS A GOOD IDEA.

Sure people like bargains. Make sure you offer some kind of a discount for the first 200 clients or 6 months for the price of 5 etc. Something to make your clients feel it’s a good deal to use your services.

Tell all your friends about your business, create business cards, be knowledgeable and helpful. After you secure your first clients make sure you don’t let them down.

Got the clients, now what?

If you already started selling hosting, make sure your clients get good support and obey your policies and terms of service. Before you sell the first hosting account make sure you prepare a VERY well written guide with all the things they can and cannot do on your servers. These have contractual value and you can find the abusers and get them off your servers.

Try to offer an excellent support and be helpful. This might be your chance against those huge hosting companies. No one said you can’t make it in this business, it’s just difficult since people have high expectations and you need to be on the top of your game.

These would be the things I’d have in mind if I wanted to offer hosting on my own. With a good registrar (so that you can also register domains for your clients), a good reseller-dedicated plan and a very serious money plan you can start being the web hosting provider you know you can be. And don’t forget: you don’t have to become rich in 3 months, just develop nicely and keep an eye on those expenses. The web hosting business is a marathon, sometimes the slow turtle can win against the fast rabbit. Don’t sprint, be ready for a very long (and let’s hope prosperous) run.