Unlike mydomain, I will only offer Domain Name Hosting/Redirection, whereas mydomain offers that and email redirection too.
I actually know a few people using mydomain services, but they say that at least a few times in the month the sites go down...so I want to take advantage of that and "buy" over those people that do not like their service.
Reason for doing this project is to build public awareness of the business name and services.
You need to think about the cost of doing that. If you sincere about building business credibility, you can offer few months of free hosting before charging your clients. Free domain hosting would be a good idea if you can ensure that your service is better and more reliable than mydomain, otherwise, you will lose customers as well.