In June of 2003 I purchased a computer with the intention of learning how to administer a server and host my own websites. By Xmas of that year, I had everything figured out and I was able to begin hosting myself. By then, I got the idea that I could help pay for my internet connection fees by hosting other people too. So I got my first customer in January of 2004. Over the year, I accumulated about 12 more customers and now I'm up to 16 customers. Generally all of them are paying me about $100 a year for 1 gig of space and a slew of nice features that I've installed and tweaked to perfection. I realize the price is pretty low compared to other hosts, but I feel like I've got to be competitive.

Now I'd really like to branch out and make some real money, but I'm not sure how to proceed. Currently I've got my servers sitting in a spare closet on my DSL connection and everything seems to be going well. I still have plenty of bandwidth left and a seemingly endless supply of disk space and CPU. So there is room for a little more growth, certainly. The problem I see is, how can I *EVER* make any money doing this. My goal is not to be filthy rich... I just want to make enough money to support my lifestyle so I can quit my job and work for myself. I don't have lofty goals here... I just want to be my own boss and do what I enjoy... tinkering with servers and whatnot.

Well, if I had 200 customers, that would only be like $20,000 a year. If I had 500 customers, then *maybe* I could live well enough to be my own boss. But there are so many other questions that bother me. First of all, I don't know if I can even handle 500 customers all by myself! I'd probably have to hire somebody. And I just don't see that being realistic if I'm trying to survive off the income I'm getting. Plus having my servers in a closet isn't going to work for very long. I'm going to have to rent some dedicated machines because I don't want to pay for insurance and fire protection and a massive generator, etc, etc.

So my question is... how can this eveb be done? It almost seems like there is no money to be made in this business. I don't think I can make enough money to be profitable. Is there something I am missing? What's the solution? Obviously I have to offer more than just hosting... maybe site design also. But this is going to be time I have to spend NOT supporting my hosting customers.

Alot of big Web Hosting Companies make 330,000 a year. Some have you 4,000 clients more even make probaly $1,000,000 million a year. Get your name out there and give great support reliable service and everyone will come to you.


Once you grow bigger you can start hiring them. Give them free hosting or money and they'll come and do it. Just if you hire more people the better support they will be also make sure they have experience before you hire them. You don't want to hire someone that just talks about sports and has no idea what he is doing.

There is deinately money to be made. There is not however, money to be made overnight. This business is just like every business, in that you need to develop customer realations and it takes time to establish yourself in the marketplace.

It will take time and experience to make your web hosting company your only source of income. The fact is that there are way to many web hosting companies out there, and it is virtually impossible to separate yourself from the pack and offer something that hasn't already been done. Having said that, you need to build a reputation for your company, and earn your money from acquiring customers that signed up with you because of that reputation.
The days of offering something unique, or something at a remarkable price are long gone.

Yes that to. Don't expect to make money over night... You have to work for the money. Just work hard and do the right thing. Be honest, be fair, and be kind. And you'll get big.

Yeah, but can I reasonably expect to make the kind of money I'm predicting in my post above? And will I really be able to handle 500 customers myself without hiring any help?

I dont' see myself being able to hire anybody until I have a small army of customers, so that means doing everything all by myself, and I can't quit my job until I make enough to support myself... so that means trying to support all these people in my spare time. Granted, my job is pretty lax and I could probably do some minor support even though I'm on the clock at my real job.... but still... 500+ people seems like an awful lot.

It is alot.... You won't be able to handle this many customers unless they never need support and are just legit with Web Developing.

It was much easier to make money in the business just a year or two ago than it is today! Good luck! :)

I know, there are just some many companies now.

Originally posted by stokes_83
There is deinately money to be made. There is not however, money to be made overnight. This business is just like every business, in that you need to develop customer realations and it takes time to establish yourself in the marketplace.

It will take time and experience to make your web hosting company your only source of income. The fact is that there are way to many web hosting companies out there, and it is virtually impossible to separate yourself from the pack and offer something that hasn't already been done. Having said that, you need to build a reputation for your company, and earn your money from acquiring customers that signed up with you because of that reputation.
The days of offering something unique, or something at a remarkable price are long gone.
Indeed you have to have the time and patience at time youll think why do i bother but of you put the time in youll succeed;)

Unless you are prepared to 24x7 and 365 days a year it wouldn't be reasonable to expect to handle 100 customers by yourself. Using a combination of your own time, outsourced help, and eventually your own employees time you can scale your business as need be.

The first step for you would probably be to "come out of the closet", so to speak, and lease or colocate a dedicated server in a real data center on a real connection with real contingency plans. There's no way in hell you'll earn a living with servers in the closet.

What if the power goes out? It happens. What if a truck hits a pole carrying your DSL line? That happens too. You'd need to invest an awful lot of money in redundancy of power, connection, etc. in your home in order to become a reliable host.

Indeed 100 customers isnt manageable by yourself effeciantlely, unless youve got most of the day to yourself.

Do not forget operational costs will increase with more clients.

The way you've extrapolated your expected return is based on perfect world numbers.

Don't forget if you do build your company you'll need to rent a server from a data center. The 16 clients you have right now are probably some of the best behaved you'll ever have. Hackers, phishers, spammers.....and others will certainly infiltrate your business - it's guaranteed.

Do you have the capital necessary to go through the tough times? Or will one long downtime completely destroy your reputation, and thus business?

There is money to be had, BUT....to build a business you need money, time, and 100% dedication. A hobby doesn't bring profits, a business does.

It is very possible to make the kind of money you want to in Web Hosting... the best way to do it is to develop a business plan that says what you are going to do, who you are going to do it for, and how you are going to do it.

Originally posted by Naz.A
Indeed 100 customers isnt manageable by yourself effeciantlely, unless youve got most of the day to yourself.

Like it's been said in other threads, wouldn't this depend on the type of customers?

There are many hosts handling more customers than that... in their spare time

Originally posted by amish_geek
It is very possible to make the kind of money you want to in Web Hosting... the best way to do it is to develop a business plan that says what you are going to do, who you are going to do it for, and how you are going to do it.

Make sure to plan out goals in this so that when you get close to being able to work for yourself you don't think "Oh crap, if only I set prices 20% higher when I started..."

Plan pricing for years to come!

Man, we get so many posts like this on WHT! Yes, there is plenty of money in the web hosting industry, and there will be for years to come. However, contrary to popular belief, this is NOT a get-rich-quick business! It takes years and years of dedication and commitment to make hundreds of thousands, possibly millions of bucks!

Originally posted by Donboy
Yeah, but can I reasonably expect to make the kind of money I'm predicting in my post above? And will I really be able to handle 500 customers myself without hiring any help?

I dont' see myself being able to hire anybody until I have a small army of customers, so that means doing everything all by myself, and I can't quit my job until I make enough to support myself... so that means trying to support all these people in my spare time. Granted, my job is pretty lax and I could probably do some minor support even though I'm on the clock at my real job.... but still... 500+ people seems like an awful lot.

I think one of the main things I would focus on would be self-service support. If you give your clients the resources to support themselves, you can solve 80% of the "problems" for which they will create tickets and make phone calls.

I'd actually love to hear what other hosts think about this topic and how is helps them solve their customer support needs. Things like demos, knowledgebases, help documents, etc. are very important, I feel.

Am i correct in saying that you intend to run 500 clients using a DSL line ?

>Indeed 100 customers isnt manageable by yourself effeciantlely,
>unless youve got most of the day to yourself.

I am managing 1600 alone... And by the end of the year I am expecting it to be 5000.

The problem I see with how you are approaching the business is trying to make money without first spending money. Any good hosting business needs a decent amount of capital to really start up properly. Hiring support techs should be in your business plan already, as well as your growth precitions, advertising goals, budgets, etc...

It takes money to make money :)

Originally posted by Donboy
Currently I've got my servers sitting in a spare closet on my DSL connection and everything seems to be going well. I still have plenty of bandwidth left and a seemingly endless supply of disk space and CPU.

It is not a good idea to be hosting people that pay you off of a computer in your closet on a DSL connection for many reasons. Some of these reasons include but are not limited to: no redunancy, if your connection is attacked no hardware to mitigate, no room for expansion on many levels, there probably is no SLA on your DSL as it is a shared resource, etc, etc, etc.


Originally posted by thomas.smith
>Indeed 100 customers isnt manageable by yourself effeciantlely,
>unless youve got most of the day to yourself.

I am managing 1600 alone... And by the end of the year I am expecting it to be 5000.

I am surprised that you have 1,600 customers considering you didn't have basic monitoring setup on your server(s). What is your site?

Originally posted by justadollarhostin
It takes money to make money :)

Oh so very true. A business plan is also quite necessary.

Originally posted by Donboy
Yeah, but can I reasonably expect to make the kind of money I'm predicting in my post above? And will I really be able to handle 500 customers myself without hiring any help?

I dont' see myself being able to hire anybody until I have a small army of customers, so that means doing everything all by myself, and I can't quit my job until I make enough to support myself... so that means trying to support all these people in my spare time. Granted, my job is pretty lax and I could probably do some minor support even though I'm on the clock at my real job.... but still... 500+ people seems like an awful lot.

Which is why you need to make sure you sit down and map out a business plan. Five hundred customers is quite a bit to handle on your own. If you don't start out charging enough to cover tech support expenses later, you'll be doomed to fail.

--Tina

500 is not a lot to support yourself. You can easily do that if the hosting is your main job and you don`t have other stuff to do.

Originally posted by thomas.smith
500 is not a lot to support yourself. You can easily do that if the hosting is your main job and you don`t have other stuff to do.

Yeah, but can you live on that wage?

--Tina

Originally posted by AH-Tina
Yeah, but can you live on that wage?
Depends on what country you live in, if you have a family to support, and your living arrangements etc. So many variables there to consider.

Originally posted by Aussie Bob
Depends on what country you live in, if you have a family to support, and your living arrangements etc. So many variables there to consider.

It also depends on how much each customer pays. If they are paying $10 on average you can make a living of it in almost any country even after paying all your costs.

Are you hosting these clients on your home computer??!?!?!

Originally posted by Donboy
Now I'd really like to branch out and make some real money, but I'm not sure how to proceed. Currently I've got my servers sitting in a spare closet on my DSL connection and everything seems to be going well. I still have plenty of bandwidth left and a seemingly endless supply of disk space and CPU. So there is room for a little more growth, certainly. The problem I see is, how can I *EVER* make any money doing this. My goal is not to be filthy rich... I just want to make enough money to support my lifestyle so I can quit my job and work for myself. I don't have lofty goals here... I just want to be my own boss and do what I enjoy... tinkering with servers and whatnot.


it sound like you're using your home DSL to do webhosting. maybe it's good enought to support 12 but i don't know if it can support 100+ customers if you want to go big like you said.

Yeah, I'm doing this from home. I've got 5 machines I've been building up for the last couple of years and I think I'm ready to colocate them. Or I guess I could get dedicated machines... I think they seem to be cheaper... and rsync my data to those machines. I guess they would let me do that. I'm about to call some places here in a few minutes and find out what its going to take.

i've also started writing up a business plan. I would really like to see some of yours! I searched the forums to see if anyone has posted theirs, but I found nothing. Is this one of those things that nobody shares?

Please tell me that you at least have a business broadband connection. Your ISP will have fits if it finds out your are doing that on a personal connection.

Even if it is a business connection its a disaster waiting to happen.

As for can you support 500 customers on your own?

Well we have managed with the customers we have at the moment with them asking very little support, we get asked the same questions so we have come up with tutorials which go down really well, but if we started signing up people who are less website savy and you are not prepared then it could be a problem supporting just 10. It depends on the customer and what tutorials, knowledgebase system, forums etc that you have and the customers you attract and how prepared you are.

I doubt anybody can tell you exactly how many customers you can manage on your own as that is almost as optimistic as expecting an answer of how many people can a server manage. Far to many variables :s

If you have managed to attract some customers already then you are definately doing something right - look at how you attracted these customers, would the same methods work? I am sure with some good planning you will do great. Good luck :)

Please tell me that you at least have a business broadband connection. Your ISP will have fits if it finds out your are doing that on a personal connection.

Even if it is a business connection its a disaster waiting to happen.

As for can you support 500 customers on your own?

Well we have managed with the customers we have at the moment with them requiring very little support with the exception of one customer who takes up a lot of time. When we do get support requests we are frequently asked the same questions, so we have come up with tutorials which go down really well, but if we started signing up people who are less website savy and we were not prepared then it could be a problem supporting just 10. It depends on the customer and what tutorials, knowledgebase system, forums etc that you have and how prepared you are.

I doubt anybody can tell you exactly how many customers you can manage on your own, as that is almost as optimistic as expecting an answer for how many people can one server manage. Far to many variables :s

If you have managed to attract some customers already then you are definately doing something right - look at how you attracted these customers, would the same methods work again and again? I am sure with some good planning and a business plan you will do great. There are hundreads of data centers available and lots of managed servers or reseller accounts, shop around for what is best for you!

Good luck :)

I doubt people would share their business plans as sadly this is a very cut throat business atm with all the competition. Also you may find that those customers you have now are great but then the next one will use more bandwidth and resources then all the others put together.

Im also looking into starting up a business with a few ideas, the problem I have at the moment is capital, I used to admin a windows network for a company that decided to relocate so im out of work atm. I was thinking of drawing up a business plan and proposal and seeing if I could get a start up grant from a bank. As for support you may be able to partner up with someone else to share the work load, I know this mean less profit for you but they may be willing to work for a stake in the company rather than a wage.

The main problem I can see really wouldnt be if you can make a profit etc but instead how you are going to get customers to choose you over the other people out there. If you can work that one out you should be able to get the money you want with a lot of work and dedication.

Ok - I definately need more sleep. That has been posted twice? I am sure I cliked edit.

I am not seeing double am I :(

Maybe its time for some sleep again!