I've just spent the past few minutes browsing through posts in this forum -- and it always hits me how many entrepreneurs and aspiring business magnates want to start their own web hosting business.

First of all -- does anyone have an actual figure on how many web hosting companies currently exist, worldwide? I'm sure it'd be a very intriguing, and perhaps intimidating figure.

Secondly -- starting a web hosting business is just like starting any other business. You should have a solid business plan, and you should know who your CUSTOMERS are.

I don't know if any of you would agree, but I have the feeling that many people prioritize the setting up of a web hosting company by choosing their name, picking out a template or hiring someone to design a web site, grabbing hold of a server then posting on forums to tell everyone about it.

I hope someone who has started from the grassroots of this business by seeing a NEED that isn't being fulfilled, and building a successful web hosting company can share their insight.



JP

No offense to you hosting people, but you must know what you're doing.

Sorry if it's too offensive but I will say it..now, everyone that has the money, buy a server, get a webdesign, hire an admin, and wait for customers...

What I want to say is -- A lot of people don't have the "knowledge" (and please put many lines under knowledge) to build a hosting business. Money isn't the only important factor, nor designing a site. When you get into it, you'll know that technical knowledge is even a must, you can't do without it.

I agree with johnder here. The very successful hosting company is which made by a few technicians who REALLY know what they're doing.

I just wish that each hosting owner really has the knowledge to operate his hosting business and keep an eye on his techs always and know what they're doing.

I know you really have interest in doing business, but what's it?

Good points, Newlook.

I think one of the allures is the money -- as many articles, forum posts and others have pointed out, in the dot com days, start-ups sprung forward and we needed hosting companies to host our web sites, right? Thus, the web hosting business grew.

Today, I think we're on an upswing, again. Just read this month's issue of Business 2.0. But even setting that aside, if we were to conduct a survey, right here and now, to answer the following question:

Q. What is your PRIMARY motivation for starting a web hosting business?

What would YOUR answer be?

I'll admit, I myself was lured in by the prospect of making a recurring income. I was surprised at how many things CAN go wrong. I'm not a tech -- when things go wrong with my server, it gets really bad. =( But I've also learned how many hours are actually required to run a web hosting service WELL -- meaning being able to be there when your customers need you, resolve issues quickly, all while marketing your business in order to survive.

And today, just thinking about it, I've realized where I've made mistakes, and I'm using that to solidify my business.

But for anyone starting out -- I say do your research, and make sure YOU have a market, and that you know just how much work will be involved. Anyone can slap together a web hosting "web site" all ready to take orders. But once you're sitting there wondering where your clients are, or wondering why you're using up your credit card but not earning any revenue... well... =/


JP

I agree with both of you people just open web hosting business because for $100 it can take them to heaven. They can get a domain name for under $10. A reseller account for about $20. Template would cost around Free-$100. So yeah a lot of people go into web hosting because they think it is cheap and very easy to do. I thought that at one time too but I researched everything found out the truth and decided anyway to do web hosting. Web Hosting is very fun and rewarding and can be terrible at some times too. But I wouldn't give my hosting business up. Yeah their are a lot of hosting businesses in the world but that doesn't mean anything. If you want to start up a web hosting business my advice is research everything before you decided to do anything.

Originally posted by johnder
Q. What is your PRIMARY motivation for starting a web hosting business?

I would say that there are millions of domains sold a month. More then even during the dot com boom. Honestly if you don't have a site for you business then your loosing business to your competitors who do have it.

A lot of people get into the hosting business because they are misled into thinking that it's an easy way to make money.

Unfortunately, most people get into it without a budget, time, or even any creativity because the barrier of entry is so low.

Very few companies actually make over $30,000 in revenue per year (I'm not even talking about profit, but rather gross income), but since people don't know what's going on behind the scenes, they see 1,000s of shiny hosting sites and assume that each one is providing a comfortable living for the owner.

Boris

Totally agree with you hvoice-boris...

Two years and I'm still no where near where I want to be. This business takes a lot of stick-to-itedness for lack of a better word. I think many companies just get bored and close shop.

The reason I started a webhosting business was because I had large site. I bought a reseller plan for this reason. And just to recover the hosting fee, I thought selling space to a few of my friends might work out. My webhosting is successful because I had great customer referrals and I had clear business goals.

Originally posted by hvoice-boris
A lot of people get into the hosting business because they are misled into thinking that it's an easy way to make money.

I'm with you there Boris. The grim reality is getting a web hosting business off the ground, using quality resources, is a lot of hard work.

That initial outlay will eventually pay out if you work hard and stay true to the ideal of what you're doing.

Eventually things become easier - especially when the paycheck becomes something you can live pretty well off.

In all honesty most people who fall into this business would probably be better off sticking with Burger King. They'll get paid more and won't have to worry about having to be 'the boss'.

... oh, and worrying about being the cause of killing a number of small businesses who entrusted you with their online presence. While these kids pack up and go surfing, small business people suddenly have come up with an idea of how they're going to feed their families and pay their bills.

Done right, there's a lot of pressure, but done right there's a lot of rewards too.

Originally posted by monster123
I would say that there are millions of domains sold a month. More then even during the dot com boom. Honestly if you don't have a site for you business then your loosing business to your competitors who do have it.

Actually, during 2000-2001 I believe the peak was around 150,000 domains per month in the main gTLDs. For the most part, the ccTLDs are much smaller. It might be that high again, but I don't think it has ever been millions.

In fact, .com and .net are in decline in terms of total number of domains. This doesn't mean there aren't new registrations; just that more are expiring without renewal than the new registrations.

http://www.icann.org/financials/revised-proposed-budget-24jun03.htm

Kevin

Originally posted by akashik
The grim reality is getting a web hosting business off the ground, using quality resources, is a lot of hard work. Yup, it is also very rewarding when done well and very addictive :D There is nothing better than getting e-mails from clients expressing there satisfaction at the way our techs have handled a problem. Of course there is also nothing worse than a complaint as well, but we all need challenges, and turning a complaining client into a happy client is most rewarding and satisfying.

I wouldn't want to work in any other industry

There is wisdom in the counsel of many! Webhosting and its analogue variants is by no means a pipe dream.. To this day (1 year + a few months) I have spent a few thousand dollars roughly around 5K give or take, and this is not counting my recurring billing, but some of the items were\are laywers, accountants, book keeping, resources, growth, and this does not include the psychological aspect as well.

Why get into it? Well if you get excited watching Star Trek Voyager and sitting at the console of your *nix terminal session then that can be a good reason :D All seriousness aside I got into it because I want to become more involved in the IT sector, and feel that I can contribute to the success of many businesses with my web services plain and simple. I love it, and plan on staying in business for the long term.

The experience acquired cannot be ontained from a book an example would be different personality types, being scammed by some IT Wholesaler from Toronto, or getting several compliments on how you helped a clients business.. Its great, and I plan on expanding. Thats my piece.
-Bones

Well put bones.

I think we all love the work though don't we? Ok.. maybe not all of us. But I personally enjoy the challenge of every day small business problems and issues.

We are a small business, in fact very small, but what I hear from the larger gurus is nothing but good because they enjoy their work and learn something new every day, even after 5-10 years of being in the field.

Granted, there will be, and there have been a lot of, individuals or small groups grabbing their hiking gear thinking they are going to climb the steep, slippery hill and make it to the top in a year or so. And when they don't make it or they just aren't satisfied with their rate of accent they simply quit. But hey, that's in all business.

So why get into it? I got into it strictly for my love of two things- computers, and challenges. We all had some computer background before we started didnt we? And we all got compliments from our peers on how awesome those skills actually were, right? And so we decided hey, why not try to make some cash off of this and have fun while doing it, correct? Well no one told us it was going to be hard! Or did they?

The true defention, or at least the one from dictionary.com, of an entrepreneur is:
"A person who organizes, operates, and assumes the risk for a business venture." (key words: "assumes the risk")

We've got challenges, headaches, competition, shady dealers, saturated fields, down time (even though my host is SUPERB and has been utterly flawless since we've started) and we love it.

To sum things up: "To not enjoy a good challenge is to not enjoy web-hosting"

Web-hosters Unite! :)
DLee

Originally posted by gghosting
I agree with both of you people just open web hosting business because for $100 it can take them to heaven. They can get a domain name for under $10. A reseller account for about $20. Template would cost around Free-$100. So yeah a lot of people go into web hosting because they think it is cheap and very easy to do. I thought that at one time too but I researched everything found out the truth and decided anyway to do web hosting. Web Hosting is very fun and rewarding and can be terrible at some times too. But I wouldn't give my hosting business up. Yeah their are a lot of hosting businesses in the world but that doesn't mean anything. If you want to start up a web hosting business my advice is research everything before you decided to do anything.

same here but i also want to learn how to manage a server. however, if i can't get enought clients to at least cover the server cost. i'll give up the server even tho i don't want to. :(

i used to own a webhosting biz, but recently shut it down
i mean there are hundred others, more famous
so therz not much point really

Originally posted by rn_panamix
i used to own a webhosting biz, but recently shut it down
i mean there are hundred others, more famous
so therz not much point really

With that immense magnitude of inspiration for success, I can see why you shut it down. ;)

We started the web-hosting business just to sell of extra resources on our dedicated servers. We moved from shared hosting due to bad uptimes, high-loads, and support staff who know nothing about Unix..

We never planned on making money from the hosting, or making it big... just trying to stay out of the red zone.

As far as success? Despite our efforts, the servers are not completely paid off each month, leaving us with the decision of cutting our losses or continuing the next month.

We got into webhosting knowing we could help our current clients grow thier businesses. Businesses which see growth from your efforts will be more inclined to spend more money for other services which help grow thier businesses.

One issue, you can't be a one man total operation and do everything. Specially if you want to advertise 24/7 tech support.

Hosting is a real pain in the butt if you dont know what you are doing and dont have litterally 24/7 to run a company. I mean, their are no weekends or 9-5 or anything.

The financials I used for my business plan deterred me from starting a web hosting business.

Sequence:

(1) Signs up a hosting account
(2) Finds out about reseller accounts
(3) Resells to cover cost of own website
(4) Thinks: " This is great! I am a webhost! "
(5) Tries to sell more web hosting
(6) Makes very little and wastes a lot of time

:D

Originally posted by Nilomedia
. . . The very successful hosting company is which made by a few technicians who REALLY know what they're doing.
Not always. ;)

"Technicians" rarely understand the enormous complexities in building a hosting business (customer acquisition, customer management etc etc etc), nor do they have the business skillset to make it happen. Some do, but that would be rare, imo.

The technical end of a hosting business is a very important area, but would probably represent 30% of the overall skillset required, to build and operate a successful hosting operation.

with the right skills, the business could cost 9$ per month, and only cost you your time

Hello,

I started my hosting biz on June 2003. To me it happened suddenly.

Me and my three friends, buy a server, cheap ones
Pentium 4 1.8Ghz and 512 MB RAM.

We use it for personal use among friends, we sharing videos that me made ourselves.

To support our server cost, we supply website to our close friends and online members. Well, suddenly it when boom. At first we are happy to see money flows in. Then we realise that we have client base. So we planned out to make our services commercial.

Thing turn out better, with up and down. But we learn a lot in past 1 year. And we need to learn more.

Like I said, we are accidently entered this webhosting industry.
But ones you entered it, it is hard to get out from it :)

Thank you