Do you make any profit, a lot of profit or are you begging at the streets to keep your business running :D?

Jacco

Finally we can say, yes we are profitable

After how many months/years?

Originally posted by tazd9t9
Finally we can say, yes we are profitable

well we messed up our start up a bit, we were running another hosting company which was profitable within a month. This time its taken about 6 months because we had high startup costs.

It has taken about 4 years to get stable, however we have always made a profit. Thanks be to God ;)

Originally posted by tazd9t9
well we messed up our start up a bit, we were running another hosting company which was profitable within a month. This time its taken about 6 months because we had high startup costs.

Who hasn't messed up a little in the begining? The important thing is to learn from your mistakes and get better all the time. We wanted to start right at the top with the best server hardware and best everything. Now we know from experience that it's better to start slowly and work your way up. All things are good now ;)

I agree with Saeed...my company is currently in the process of restructering its internal management to provide better support. Can't wait can't wait can't wait...


- Salam

By the end of the month we should be. First month in service, so we should recoup all our initial costs in the second month.

Sometimes it takes time to make profit.

Sometimes it would be better to serve as web development plus web hosting company so that you can compansate your initial costs in web hosting.

We've been doing web development and design for 10 years :) Don't worry, we won't go under because of the hosting side of things :)

Right now our losses are a whopping 12$/month, as the existing paying customers cover the rest of the 200+/month. We've got contracts signed for the rest of the costs, payment just hasn't begun yet :)

As I said, I'm not worried, just waiting :)

I've posted this story a couple times, but it's such an eye-opener to brand-spankin-new hosts, I'll type it again. :D

We first started out several years ago colocating at a big ISP. Within a couple months, we had enough customers to cover our colo fees. We were profitable!

Or were we? The four partners weren't being paid. Took a long time to start paying a living wage. But then we did. We were profitable!

Or were we? We really should have a professional office shouldn't we. So we got one, at some $2400/month. Took a few more months to recoup that cost, but then we did. We were profitable!

Or were we?... You get the idea.

There are always phases of growth with any business. The fact that you were asking yourselves those questions meant that you were likely not just concerned about yourselves but also your clients.

After all, it's difficult to grow that big without taking care of them. Good for you, maybe you should write an article on what you learned (did good/bad) and what you wished you'd learned during that time?

:beer:Profitable!:beer:

Here's to you sonic :beer:

Profitable as well. :D

Web hosting is an extremely tight industry much like the telecommunications industry where margins are razor-thin. In fact, I'm not sure if *any* of the public telco's are *truly* profitable since at least one of them (cough, WorldCon) has smoked their books (in WorldCon's case, I think they dropped the A-Bomb on their books).

:beer: to profitability

Originally posted by magnafix
I've posted this story a couple times, but it's such an eye-opener to brand-spankin-new hosts, I'll type it again. :D

We first started out several years ago colocating at a big ISP. Within a couple months, we had enough customers to cover our colo fees. We were profitable!

Or were we? The four partners weren't being paid. Took a long time to start paying a living wage. But then we did. We were profitable!

Or were we? We really should have a professional office shouldn't we. So we got one, at some $2400/month. Took a few more months to recoup that cost, but then we did. We were profitable!

Or were we?... You get the idea.

This is probably the biggest lesson I learned watching the companies I worked for in the past operate. "Ooh we're big time now, BIGGER BUILDING!!" oh wait a minute, there goes all those "big time" profits.

Lesson #1: when your head gets too big for your hat, it's not time to get a bigger hat.

Edit:

Another problem with many new hosts (and this is something I realized back in January) is that just because I took in more money this month than I spent, am I truly profitable? At the end of January I had around $3000 in expenses that month and around $13000 in income, profitable? No. Not really.

Yearly signups, they accounted for a LARGE portion of my income along with a good helping of domain registrations.

So, had February come and I not signed up another single account, I would have been in deep trouble, on Jan 15th my total recurring monthly payments were $864. (Did I mention the $3000 in expenses?) So had not one more person signed up for hosting after Jan 15th, we could have floated on revenue until maybe, maybe, June. Because we weren't truly "profitable". Of course February came and went and we took in as much again, and March, and April (you don't make $13,000 in one month and $0 the next "usually" but you've gotta look at things in the proper light).

This revelation prompted me to not even offer yearly payments on reseller accounts (that and fraud worries). The reseller accounts are all monthly except for a handful who sent checks for the full year, and that (and many new monthly customers) has taken us into "profitability".

Now if not one new customer signed up next month, we'd make money, not a lot, I'd be eating bologna and crackers for lunch probably, but we'd pay the bills and survive. So I guess I can say we are profitable.

They key is not having rock bottom prices.... Set your prices where they need to be to cover your expenses and salaries, add a little more for your comfort, and then provide outstanding service. This recipe works wonders...You might not have 10,000 clients, but I'll take 1,000 clients that bring in the same amount of money as 10,000 anyday.

Is my company profitable? Yes. 1500 clients, Revenue $600,000+ yearly, expenses approx. $400,000 (includes salaries). :)

It can be done!

Hi,
Im setting up my new host soon.
My last host however was profitable and it made a few ..umm... dollars :bawling: :eek: Peanuts! But I charged too much I think:

$10 per month { 50mb space and 500mb bandwidth :rolleyes:
:laugh: what was I thinking!?

Anyway it is possible. I know many online mates that are already into a few grand profit after only a few months of business.

Good luck guys!

:eek:

Originally posted by Dixiesys
...I'd be eating bologna and crackers for lunch probably...
Luxury!

According to our auditors we made $6 billion last year. We use Arther Andersen.

Originally posted by freakysid

Luxury!

According to our auditors we made $6 billion last year. We use Arther Andersen.

Yes, after we duplicated all of our orders 60 million times. I was sure they wouldn't notice :D

to be profitable you need to have something new to offer
and have just the best people working for you.
It is not the number or people working but the quality.
the automation is the key like sphera and ensim
or special products like we have. Just stay and do the best you can and if you are still up 1 year from now. Your company will cost a lot to buy.I call a new start on horizon.
Best to all of you because I am the same.

We've been profitable since the end of last year. We're seeing growth on the order of 15-35% per month, which is helping us a lot.

If we can keep this up, we should be able to open our own datacenter by the end of the year just using our profits to fund the expansion. That's the long term goal anyways...

Take care,

Brian

We've been profitable for about a year now, but then again we own all the servers and all the switches that we use in the racks we lease, else we'd have been profitable earlier.

Just as a general observation (So please no one take offence at this), but these days it's hardly difficult to be profitable if you're just using a cheap $99 rackshack server is it? I'm not saying there is anything wrong with that (Although I do know I wouldn't bet my business on one of them for many reasons, more to do with the setup of them then the company).

Very true Karl, by the same token though it does allow a company to see if hosting is actually something they wish to pursue. Sinking 25K into routers and switches can be a costly venture if there isn't actually a market for your product :)

Originally posted by Jeremy W.
Very true Karl, by the same token though it does allow a company to see if hosting is actually something they wish to pursue. Sinking 25K into routers and switches can be a costly venture if there isn't actually a market for your product :)
Very true, I don't think I'd recommend to anyone to jump in that deep to start with. It was more a general observation on the direction the industry seems to be moving in at the moment.

True, but I think it is good. It means that those who get to the stage you guys have grown to won't simply be those who have the cash to sling around, but more likely than not, those who have worked hard. It's good to have an elite who have worked hard to get where they are :)

Yep, I know a lot more now then I did when we first started, but strangely I'm not sure I'd have wanted to know what I know now when we started. I personally think it's much better if you do have to fight and work hard at everything, possibly even struggle at time because you come out of it stronger in the end. They say money is power, but in this game knowledge is truly power.

Anyone fancy going back on topic now after my earlier diversion?

We were profitable after 3 months, but it did take quite a bit of startup investments and work (obviously).

All the old topics are coming back up :D

Still haven't heard back from you on that domain name Marc. If you don't want it just let me know.

<snip>

Just got your email this morning. I think your email is having serious delays, or its my private @mail.com account :(

Sent: Wed, 14 Aug 2002 23:15:47 -0500
Received: Fri, 16 Aug 2002 09:37:21 -0500

Expect a reply in a moment :D

Must be your mail.com account.

I was just talking with someone in real time over email. :)

We are also profitable. We been growing at a very fast rate, in fact last month we had to turn down new clients while other servers were being built.
This is a great industry!

Define profitable :(

Yes, each month there is a small surplus when I look at the income and at the server cost.

Still about $ 6000.- of startup costs that I need to earn back though so although the monthly income is in the black if you look at it from start till now it's still in the red.

Also I really should calculate the my own time in the cost ...which I don't do right now....

So to be honost, if I payed myself $ 65.- per hr for running this whole doodle I'm far FAR away from any kind of profit.

But hey, when you start a new company you don't expect it to become profitable for the first 4 years. Looking at it that way I'm not doing too bad after the first year. Only 3 to go. Yay!