Approximately how long did it take you guys to start making a profit?? Just asking so that I know what I *might* be getting myself into ;)

Well it all depends on your bills, liscensing costs, and so on and so forth.

Since my initial bills were relativly low I was able to make a profit about the end of the first month, of course I sold a couple dedicated servers in there so that kinda let me cheat! heh :).

Well what types of bills should one consider?? Apart from the server cost and monthly bandhwidth cost, a lil advertising, which is kinda cheap here in bombay, what else? this is for virtual hosting!

software , to track your users and billing, support staff or some help eventually, mostly time. It nothing to work 18hrs a day for me. Im a freak like that though, overly dedicated :)

Originally posted by jaguar
It nothing to work 18hrs a day for me. Im a freak like that though, overly dedicated :)

That sounds about right! Work all day at the comp, eat occasionally, lotsa coffee and smokes, shower then straight to bed.... wake up.... same thing all over again - 7 days a week, all year long!

If you want to make this game play (design or hosting), you have to put some nasty hours in. Still, a lot of people get into this game after some horrid jobs previously so the thought of going back to 'wage slave' is more than enough to keep you going. Besides, even with the lack of sleep, poor hygiene, bad diet... would you REALLY want to do anything else??

I thought not *lol*

I may be aging at twice the normal rate right now but the hard work now will pay off in the end. Besides my setup has a kick-ass sound system attached (Altec Powercubes with subwoofer attached to a Technics diskman) so I can kick back and just go to work for a day or two, stopping for coffee and a ciggie occasionally. I may feel like a Borg at times surrounded by electronica, but my daughter has everything she needs and I'm still banking money faster than my old job *lol*

Hmm... what a bizarre concept - getting paid for something I enjoy.. *wheee*

Mix a goth/industrial freak, the net, and 500pds of hardware, software, and CD's and sha-bang! --> akashik.net

Ain't it fun!

Greg Moore
http://www.akashik.net

So with all these considerations.. how long?? :)

Umm.. somewhere between 1 month and never :D

Seriously! There is no guarantee that you'll ever turn a profit. If it gets that easy, more competitors pop up and make it harder. And no one can make even an educated guess without knowing your expenses and business plan.

This is actually a very deep question that many start-ups fail to even seriously consider. I'm sure many would find this thread enlightening if those of us who have been in the business at least a year dig-in and try to offer some tips in the area.

Note: This is NOT to discount the statements that have already been made! The 18-hour days are a reality. The daily shower and the 'go to bed' part I don't know if I totally agree with as there are days that the shower is only a dream and times when you think you can finally go to bed where all hell breaks loose :P

But is there a profit? How much is your time worth? Greg notes he is banking more money than he did at his old job but I'm willing to bet he didn't work near as many hours at his old job. I wonder what his paychecks from his old job would have looked like if he had worked the same hours? Time-and-a-half for over time and double time for holidays? He notes he is also aging twice as fast now. How much more are the medical bills going to be in the future, the way he is working now in comparison to what they would they be if he was taking better care of himself. Not to mention the unfortunate chance of him losing his life a few years ahead of time. What is that worth? And his daughter, how would their relationship change if she saw him with a human shaped head more often than with a 17inch square head? This sounds terribly morbid. I'm sorry for that. I just feel these are all things worth considering. No offense to Greg and others at all. I'm in the same boat. It's just a boat that others need to consider before buying a ticket to sail.

Options: We could hire more help to lesson the amount of hours we put in. This of course would dig into those profits but in the end would actually raise the profit margin, in the bank, within our families, and for our lives. It's not an easy task though. Think about it... 18 hours multiplied by 30 days equals 540 hours per month. Are you worth $10 an hour? Should you receive overtime pay? Without overtime pay and a base of $10/hour you should pay yourself $5,400/month -- If you want time and half for anything over 160 hours the paycheck is $7,300/month.

Whether or not the company is making that much just depends on the company and what you do with it. I'm just betting most in this business aren't really paying themselves for their time. Personally I don't think they should be... I feel they should be paying someone else to lessen their time instead. This helps the company, the clients, and the health of yourself and family. (Easier said than done though...this is something I myself am currently working on -- after receiving a reality check)

Other expenses I do not see mentioned very often: Insurance, accounting, office space, electricity, phone, marketing, payroll, legal fees, TAXES, extra equipment, training materials (things change FAST in this business) the list goes on and on and on and on.....

From what I've seen, many are able to start up with a small amount of cash and bring in more than that amount within the first month. It looks like profit, pure and simple. But, as with most start-up companies we fail to see that 'profit' for what it really is. We fail to pay ourselves a fair wage and we forget about the many things the company will need if we do not put the profits right back into the company.

Egads I'm putting myself in a sour mood LOL. Seriously, most that survive do love this business! I know I do! Yet, it takes a certain type of person to enjoy it and if you are not that type of person it's best to stand back. As much as it is work, it is quite rewarding to watch young web site owners grow and excel, often times due to the services/support you helped to provide them. It's exciting and rarely is it boring. I'm constantly seeing new things and I'm constantly faced with new challenges. I like it that way.

I'm starting to babble though. My point is maybe we should stop for a second and take the time to really define "Profit" and see where the thread goes from there. We've all been faced with a new expense or situation that we probably had not considered when we first started...what are they? What are the expenses of hosting? What are the profits?

Deb
- Mentor A Start-Up




[Edited by Deb on 09-17-2000 at 01:24 PM]

Kunal, the general rule of thumb, if going dedicated, which can also apply to reselling is this.

Have at least 4-6 months funding to pay for

Monthly Costs, be it a dedicated box or a reseller acct
Phone Lines
Business Liscenses
Taxes
Any needed billing software
and any of the basics everyone said above :).

Yikes!!!! Deb, you really freaked me out!! :eek:


Well thanx for the reality check ;) Well I considered all that you said. I am on the comp for like 17-18hrs a day on an average!! I hate sleep :) And I enjoy it! trust me on it!! So time and stuff aint a problem for me :)


Thanx for all the help!

We trust you... about 95% of those who post on this board are dedicated to their computer (too much) :)

Myself included, even though I try to do some other misc stuff to stay healthy... but that's about it.

Originally posted by Félix C.Courtemanche
even though I try to do some other misc stuff to stay healthy...

I decided to move the mini-fridge out from under my desk and across the room, so that I'd have to get some excercise if I wanted a drink. Is this the type of healthy activities you mean or should I be doing more? :)

*gets fatter as he sits on chair for hours on end*

LOL Chicken

I think he means go take a bike ride or walk or something hehe :)

Of course I can't argue with u chicken, my full size fridge is about 6 feet to the right of me.

:D

hehe :D


I like to go Ballys Fitness and work out my bones a little.

That's probably the best thing I can do with my free time (if any)


:):):)

Too answer your questions and too keep it simple, it all depends on how deep you get into it. For instance I started out making a profit after my first week, when I had a colocated server. But over the last year we have expanded from that small colocated server, to our new hosting facility and our own T3 lines. Now after all we have invested in the new facility, T3 lines, new servers, support personall etc etc... Ill be lucky to be making a substansial profit in a year from now.

If you start out just reselling, youll see a profit right away.

Some things you should keep in mind are:

1. CUSTOMER SERVICE IS #1 in this industry.
2. DOnt spread yourself too thin. Figure out what you want to do and concentrate on just that.
3. CUSTOMER SERVICE is #1 in this industry :)

Good Luck

My company made a profit in the first month. But seeing as I started as a reseller there was not much over head. As we made more, eventually we got our own equipment etc. which did cut into the overhead. There hasn't been a month where there wasn't a profit. Those long days are a reality. Of course mine are not as long because I have classes to go to seeing I am in college ;)

If you took all the money I have made for myself and compared it to the hous I put it I would say I probably would make more working at the local McDonalds; but I love what I do so its all good.

Tcoy~

So to summerize...

All in all it's no large hassle for most of us as we're sitting here regardless doing whatever. If email comes in for support, account setup or whatever, you go to it, then go back to what you were doing. Occasionally some exercise (fridge grazing), the back to it. *lol*

As for my medical and what-not, every few weeks I take off for a few days with the laptop in tow, and blow out the cobwebs, checking email every 5-6 hours just to keep in touch in case anything crops up. I eat once a day, but don't need any more as I'm on my backside a lot in front of the comp. Coffee is king, and have a 'smoke-free' environment here so have to get up every few hours to feed my addiction. Can stretch, take some deep breaths outside and 'take a moment'.

My job has always been a 24/7/365 thing so I don't look at it per hour. End of the month there's more in the bank doing this, than what I did sooo.. *shrug* :) Have to have that shower every day though. I'm a bit of a clean-freak AND live in the sub-tropics so I'd go made without it *grin*

Greg Moore
http://www.akashik.net

Seems like we all are sailing in the same about! ;) Well, I hope I can get something running soon! Thanx for the insight on the life of a person who runs webhosting co. :)

Originally posted by Chicken
Originally posted by Félix C.Courtemanche
even though I try to do some other misc stuff to stay healthy...

I decided to move the mini-fridge out from under my desk and across the room, so that I'd have to get some excercise if I wanted a drink. Is this the type of healthy activities you mean or should I be doing more? :)

*gets fatter as he sits on chair for hours on end*

Chciken, thats the greatest post ive seen here so far.
Thanks for cracking a smile on this worn out face :)

Personally, I get my exercise by keeping the coffee way over in the other room (about 15 feet). This way I get exercise every few hours when the carafe next to me runs out :D

You guys definately need to move a bit :)

I found a cool way of wasting some time when its cold outside, that your eyes are bleeding because it is the 27th hour in a row that you sit in front of your screen and that you are too lazy to go outside to do some exercise...

It is... juggling! :) (yah right, weird you say) well... not that much. It makes you move, sharpen your agility, make your movements quick anmd precise... and most of all you HAVE to watch something moving isntead of a screen, wich is definately a plus to your eyes.

Anyway, as you can see, working for a web hosting company also mean that you don't sleep, have no social life and never wash (ewhhh).

I think I succeded to have all the good :P

hmm.. that's interesting.. and you wouldn't even have to get up off the chair! I'll give it a shot!! LOL

LOL

Jugle something light, don't use mouse balls...... keyboards don't seem to like when they get hit with them :D

Originally posted by DanielP
LOL

Jugle something light, don't use mouse balls...... keyboards don't seem to like when they get hit with them :D



Hmm.. so chainsaws are out of the question then? *lol*

Greg Moore
http://www.akashik.net

definately... try with your useless win95 and win98 cds for fun... then go hard and include win2k cd
:P

Take 5 mins off every hour, get some fresh air - go to the balcony or outside where you ca breath fresh air, come back and then continue to work. This works! I have done this for over a year - managing college, work and computers. Caffeine is Okay but not nicotine.

Coming back to the topic, Kunal, I'm also considering this for quite sometime. But if you are going to do the work from Bombay, start with a reseller account from an Alabanza powered host first. Later, when you have enough clients, get your own server from Alabanza. That's something I'm thinking about now. Also, please recommend the best reseller account from an Alabanza powered host to me. I've gotta do this from Chennai.


TheWingThing.

*Takes Mental notes*

1. Dedication
2. Caffeine
3. Smokes
4. More Caffeine

Wow Im 4 for 4! LOL

All kidding aside I liked Deb's mention of "mentoring a start up" Having a mentor would be a very big help :)

TheWingThing, just coz I am from Bombay you are recommending me to go with a reseller a.c or some other reason? :)