Heres my interpretation on whats happened with these companies.
1. Both relatively small companies (employees -- few).
2. Both taking a regular but small number of orders a week.
3. eservers.biz teamup with hostmania for datacentre.
4. For some reason both (or just hostmania) receive an excess number of orders in short time.
5. CC provider gets worried at sudden increase of amount going through, and halts payments - trading limit exceeded? (until satisfied no fraud).
6. Hostmania suffer loss of domain name.
7. Hostmania get bad components delaying server builds.
8. Provision system goes down due to loss of domain name (not sure how thats linked but....)
Not defending this, but this happens to every company when orders exceed predictions. I live in the UK and have seen it happen to companies as large as BT (UK equivalent of AT&T).
Trouble is at this point do you admit that you are a small company overwhelmed, or try and handle the "gold rush".
Unfortunately unless you can clear up the rush this is what happens.
We all react differently. I have a problem with hostmania not updating us in a timely manner -- but I can understand (or try to) why they may have not.
We all are human, and make mistakes. Time will tell if they are okay or out on a limb. Also I note hostmania has suspended taking new orders (bout time) to clear up current orders.
If you can't wait (and I almost gave up too) both companies seem prepared to refund if asked.
I don't think eservers/hostmania are a "BUST" or a "ripoff" since they are quite ready to offer refunds. This same waiting game happened with hostmania's first promotion, yet nobody complained after getting their servers. I'd have to agree it's most likely case 1, "Both relatively small companies (employees -- few)", that's probably causing the delays.
I waited my server ovew 3weeks when I ordered in June. Since then, everything looks fine. Network uptime is good and fast. No hardware problem so far. What I worry the most, is relatively few employees. I hope they have truely 24/7 support.
But that thread also shows why sometimes smaller/large companies stay quiet. I mean eservers has been updating their customers and the board about the status pretty openly. And they get attacked. Hostmania have been keeping pretty quiet and uhmmm they get attacked. what are you supposed to do ???
Seems like unless you can run a flawless business, have infinite resources you're going to get flamed.
Ipayment called late last night and cancelled our processing account. They also put a freeze on outstanding balance in excess of $40K that they owe us. This means the funds that would have been used to buy additional 80-100 servers is no longer available to us. It is my job to make sure our existing revenues are not affected by the actions of Ipayment and that we recover from this with the focus being on long term sustainability.
It was completely unexpected and therefore we had no other means of financing in place however we are trying to come up with a speedy resolution to this issue to deliver the service customers have ordered. We didn't need it until last night. Ipayment had promised that we would be paid two weeks ago and then they deliver this message.
I will hopefully have financing in place in the next 48-72+ hours, but we need to inform our customers of what's going on.
You have a couple of actions.
1.) Issue a charge back on their credit card because Ipayment will not allow us to issue credits (all clients awaiting servers) then
2.) Continue to wait for a dedicated server, or
3.) Get setup on a Virtual Private Server (VPS) as a temporary staging area until the dedicated server issue is resolved. The VPS solution will meet the needs of 90% of customers.
Yes we did set deadlines as we know we would be able to make them as we had promises of funds from the merchant. We make payment via wire transfer and the servers were ordered and due to be setup today but another broken promise from Ipayment lead to the wire-transfer failure. We were expecting them but circumstances out of our control prevented this not for the first time.
I apologize for any damage this may have caused to your business and I promise our relationship will be more than fruitful in the long run. We have the right recipe; we just got some bad ingredients this month.
Not often you will hear this, but our clients satisfaction is number one priority and we encourage all clients who have not received there servers to do a chargeback as this is the only way either party will receive there funds.
Have a nice evening and don't hesitate to contact us if you have any more questions.
eServers dot Biz - driving the 'e' into your business. http://www.eservers.biz
So we get a nice general apology for our patience, and thank you very much for lending us your cash for 3 weeks...
I'm much too pissed to write anything now. I should just go to bed...
IMHO I'd be pissed to if I was promised a server and they didn't deliver regardless of the problem. I know they got screwed by ipayment but to keep people happy they shouldn't be selling servers that they don't currently have in stock. Or these problems happen.
In the words of Dennis Miller "...thats just my opinion."
the servers were ordered and due to be setup today but another
1- According to update post they do not have the servers and they were going to obtain and setup them but ipaymants stopped them so I think if we decide to wait it will bee for a long time perhaps for at least a month. Isn't it? (I am in doubt if they risk to use resources like loans etc. to obtain the servers).
By the way merchant account used to process cards belongs to Hostmani as charge has appeared with their name
2- IPayments have not replied to my email yet. Has anyone called them by phone to see what they are goinig to do?
3- Will eservers be able to start the project again with another DC by offering new servers? (In fact I do not have enough trust with Hostmania).
I waited though the first problems, okay, I can see how things can go wrong.
But this, this really pisses me off. I had read before I bought my server in here that eservers takes a week or two to set up. I expected that... I have been understanding up to today. But THIS crap? Nearly 3 weeks?
why were they selling something they didn't have!?!?!? its like me running out and making a "special" on WHT in the advertising forums... getting the orders, collecting the money... and then telling the clients to wait 'till i got my investment...
i mean... i could even understand taking client info/etc/etc/etc... but actually charging a card and getting cash... for something they didn't even have... ???? also... each servers gotta cost more than what they charged the cards, so how would the $40-50k be enough?
Selling the servers before they are available is unfortunately pretty common among those companies that try to compete with rackshack's prices. It's not possible otherwise because they don't have the buying-power to get the rates rackshack does so they need to sell 100 servers to get the funds to set up the first 50 servers.
When this and another merchant account problem come together major problems come up as you can see now.
Just my humble opinion.
321Host-It Internet Services
ICQ: 17021242 E-mail: [email protected]
hmm... but isn't that what bank loans and credit lines and a solid business plan are for? if i took a business plan to a VC firm that involved me charging a client then getting the hardware to provide them, they'd laugh at me and get security to show me to the door... (but then again, why would i need to do that if i had VC, heh (to prove a contradiction in my statement))...
i mean... any moron with a bit of time on their hands and access to google (to look up info/etc) could write a business plan that'd get them almost any $$$ figure they want assuming they submitted it to adequate and targetted venture capital firms... bunch of venture capital firms are stupid that way... heh
i mean... if these people are underaged or whatever so they can't get credit lines... get a parent or a responsible adult that trusts them to cosign?
I guess such loans keep them going in the first time but once they've outgrown their funds they're unlikely to get further funding and need to stop taking orders for a month or two until they get enough funds through their revenues to order more servers.
Actually, that's not so bad if done properly but if you forget about your merchant account's limits you're pretty much screwed with this business plan.
321Host-It Internet Services
ICQ: 17021242 E-mail: [email protected]
I just called iPayment and I honestly think I just held the stupidest conversation I ever held with anyone in my life. I for one, and behind eServers simply based on that conversation.
I called them to request a refund. They will not do it because the account is closed and they do not process ANY transactions for their merchants.
So what happened to my money? If the merchant did not get it, then iPayment must have it, so you want me to go to my bank and request a chargeback?
Their response - "I can not advise you what to do on this matter and I can not release any information about their account."
I want to know what happened to my money - who has it. Their response - "I can not release that information."
So I said, let's recap this. I order from a legit company, you processed the order, you approved the order, then you denied the order, yet held on to my money, cancelled their account, still held on to my money, and you can't give me any information on that?
I told him that was the stupidest thing I ever heard and I will NEVER do business (if I know about it) with that company again and hung up the phone.
Atleast PaySystems, 2Checkout, etc. WILL process a refund for you. They said, without actually saying it, "screw you".
However, I want to bring out a point, that before I go with eServers again, I am going to thoroughly check out who they do business with because according to MY bank, if they run one of these specials again, being a new company, it can happen to them all over again.
Anyway, don't bother contacting iPayment (unless you want to frustrate yourself) - just do the chargeback.
Originally posted by Annette You ordered from eServers, but the charge posted as Hostmania? What is the relationship between them? Are they the same company?
From what I can gather Annette, there's a JV between the 2 companies much like the JV that eservers.biz has with DV2, in reselling their servers etc. Too much money went into Hostmania's account and it got frozen, thus preventing the setup of all those servers that have been paid for.
Just goes to show you how close to the wind most companies cashflows are when they can't come up with 50k pretty quickly to fulfill those orders....
•AussieHost.com• Aussie Bob, host since 2001 • • Host Multiple Domains on Fast Australian Servers!! •
You ordered from eServers, but the charge posted as Hostmania? What is the relationship between them? Are they the same company?
My bank just asked me the same thing and implied this might be the reason why the whole mess started in the first place.
When I explained the situation to my bank, they said that eServers should not have put HostMania as the merchant unless HostMania was the true merchant processing the payment. I do not know about the backend but on the website I was definitely on the eServer web site.
I was also told that unless eServer is located and doing business in Texas at the time of purchase then they can not charge sales tax for the servers. HostMania can charge them, and eServer can either absord or bump up the price. They can not send an invoice for sales tax which was not turn in by them. They can not charge sales tax twice either - either HostMania charges it to eServers and it should stop there.
I think the only place which we must put under pressure is IPayments. They must either release the money or refund it back to customers because money does not belong to IPayments. I think it will be effective if everyone calls them. I myself have written an email to them but I have not received a reply.
In fact eservers sells those servers for hostmania and receives a precentage of the payment for his support and partnership. We are buying them from hostmania through eservers. As Hostmania sells the servers they can charge customers for Tax.
From my understanding Hostmania can charge the sales tax since they are the ones providing the hardware. eServers can not send an invoice with sales tax on it that is not being turned in by eServers themselves. That is the key.
If an audit were to be performed, from what I am told, eServers would be in a ton of mess because eServers would not have been the ones turning in the sales tax, Hostmania would be. What eServers is attempting to do (and correct me if I am wrong) is not absorb the cost of the sales tax. That worked fine with the DV2 promotion because there was no sales tax. In this case, they should have charged the cost of the server plus tax, make that the total amount and not call it tax on the invoice.
My bank said that iPayment had every right to shut down the account because technically, whether they meant to do it or not, it was fraudulent. Unless HostMania was the actual ones making the charge (iPayment would not release that information) then eServers should not under any circumstances have placed Hostmania on the invoices.
Whether that is correct or not I do not know but that is what I was told by my bank and I believe it. In every other instance where I charged something the merchant posted on my statement was the merchant I purchased it from.
Now the point is - was it eServers account or HostMania? I did not know you could change the name on your sales to say whatever you wanted.
eservers did something for me that i really appreciate. i'm happy taht they did.
i'm just a guy who doesn't have a lot of money. really, i dont. its not easy going with a company you've never used before. ive seen so many people get ripped off by sending money through paypal and not getting what they were suppose to, then finding out they cant get any money back from paypal... so i like to spend my money carefully. i dont have a high cc limit, so i use PAYPAL funds to pay for things. now as you may know, paypal funds may not be recoverable....
so when i signed up with eservers, all these damn delays, it really scared me because i felt like i just lost $300!!!!
so i hope you could understand why someone like me, who doesnt ahve a lot of money, could be paranoid when dealing with a company they've never used before
i asked for a refund yesterday, and they told me within 24 hours!!
and i got it!!
i got my $300 back
REMEMBER, i used paypal funds to pay, so it was easy to refund. click a button called 'refund payment'
too bad it didnt work out with eservers, im just glad they were nice enough to refund me. i appreciate it.
btw, flame me all you want for talking like this (sounding like a eservers lover), but when i saw that eservers refunded my $300 through paypal i was so happy - i was glad. my worries were over.
prime, i hope you get yours too (i think it was prime who told me he paid through paypal too)
Last edited by clocker1996; 08-23-2002 at 12:41 PM.
Congrats on getting your refund. I think everyone will get theirs because iPayment did not release it and I do not think for one minute that eServers is attempting to scam anyone - I really don't. IPayments is the worst merchant payment company I have ever encountered. I hope people who use this company read this thread and wake up - this could happen to them.
What's good to hear is a positive PayPal story. You hear so many negative ones, it's nice to hear something that worked out.