Web Hosting Talk : Web Hosting Main Forums : Running a Web Hosting Business : Tutorial : Staring a Web Hosting Business

[KMyers]

Hello All,

I have seen several tutorials on starting a Web Hosting Business, but I feel like several of them are missing a few things, so I thought I would combine several of the concepts into one complete guide. This guide will be broken up into sections in order to make it easier to read. Also please don't hesitate to contact me if you have any questions, I would be happy to answer and help you get started.
NOTE : I Actually posted this on WebMasterPeers.com but thought it deserves a place here so feel free to comment in both if you want. The link for the origional posting is found here

1) Reasons to Start a Hosting Business

There can be several reasons to become your own host. Before you begin this venture, you should come up with your own set of goals and reasons. This will help keep you on the correct path and keep you motivated. I would advise you to write these down and keep them on your desk.

Here is a small list that I have put together, hopefully it can help get you started.

• I am a Web Designer and wish to provide an all inclusive solution to my customers.
• I would like to host several of my own sites in isolation.
• I need to have several sites with unique IP Addresses.
• I would like to offer a service for extra income.

Please keep in mind that the list above is not complete. You should custom tailor them to suit your desired end result.

2) Choose a Name

The next step is to choose a name in which you want to do business under. For ease of access I would advise you to keep the name short.
You should make sure this name is unique. Do a Google Search and make sure that the domain name is available. If it is I would advise you to purchase the domain name at this time.
Finally, depending on the Laws where you reside, you should register your business name. There are several options including an LLC, DBA or Chapter C. Each have their own benefits, It is best to check with an accountant for the best option for you.

3) Find a Vendor

At this point, you should start looking for a Vendor, This can be one of the following; [in order of expense] Reseller, Master Reseller, VPS, Semi-Dedicated, or even a Fully Dedicated Server. You should expect to pay between $10.00 - $300.00 per month for one of the options above. I strongly advise you to shop around. Before are a few things to keep in mind when choosing a vendor.

• Price - Look for a host that has a realistic price plan to disk space ratio. Remember that you get what you pay for. If you find a reseller account that charges you $2.99 per month for 100 GB of space --- RUN.
• Beware of Scams - I hate to admit that there are TONS of Scams out there that will charge you a one time fee for a year or even lifetime of hosting --- STAY AWAY.
• Test The Support - Don't be afraid to open a support ticket with any potential vendor. You should time the response and the quality of the response. A typical ticket response should be within 3-6 hours. Try also submitting a ticket at an odd time of the day or night to test the after hours support.
• Money Back Policy - Make sure that the vendor has a money back policy in case things don't work out. You should expect a 7-30 day policy.
• Verity of Products and Services - It is a great Idea to see if the vendor offers a selection of products even if you do not intend to sell them at this time.
• Beware of Unlimited - I am not saying that Unlimited Hosting is Bad, the problem is that it is often not done right. Because of this, most "Unlimited" host's servers are overloaded with customers.
• Billing Software - Ask your vendor if they offer any billing software (For free or paid). This will greatly help you manage your site and automate customer setups.
• Reputation - RESEARCH, RESEARCH and RESEARCH the potential host. Search any of the hosting review sites to make sure that the host does not have a poor rating. Ask for reviews on sites like DigitalPoint, WebHostingTalk.com and WebMasterPeers.com.
• Control Panels - Go with what you know, if you currently do not use a control panel, choose cPanel/WHM. Other choices include Plesk, Helm or Klaxo.

4) Plan your Prices and Plans

Now that you have your web space, sit down and think about how you intend to price your hosting. It is best to visit several of your competitors to align your prices with them. You should estimate that most of your customers will use between 100 MB and 500 MB of Space and 1-5 GB of Monthly Bandwidth. You should always price your plans at a point that you will generate a small profit.
You should also design a Terms of Service and AUP for your customers. This is a Legal Binding document to give you certain rights and lay out the rules.

5) Design your Homepage

Create an appealing and inviting site for your potential customers to see. If you have a poorly designed site, it can be a potential turn off for customers. Your page should be easy to navigate.
Design a Logo. There are several free applictions and paid sevices that can help you with a logo. This should be displayed on all of your pages and e-mails.
Brand your page. Even if you are using a Free template, you should always re-brand the page.
Set up your Biling Software to automate your orders.

6) Advertize your Site

At ths point, you are ready to start selling. However before you will get any sales, you will need to get some exposure. If you are lacking money, the best option is to get active in several online web hosting and web design forums like DigitalPoint, WebHostingTalk.com and WebMasterPeers.com. Remember to place a link in your signature to direct users to your new site. Be paitent, it can often take several weeks to get your first customers

7) Focus on Service

Do everything in your power to keep your cutomers happy. You should make customer service a top priority.

8) Re-Evaluate

You should sit down at least once a month to analyze all of your assets. You should check the available space on your server and monthly bandwidth use. If you are using up 40% - 60% of your open space, you should think about buying another server or upgrading your reseller plan.
Remember to plan for growth.

[hgpositive]

Wow, that is great. Thanks Keith

Hartono

[qMx-TC]

Thanks for that, but shouldn't it be in the tutorial subforum?

[CI-Andrew]

Nice tutorial, should help quite a few people out here.

[HostGamma]

Originally Posted by shad0wz

Thanks for that, but shouldn't it be in the tutorial subforum?

Probably will be moved there by the mod if they find it worth it, which I personally think is the case

[Alex]

We don't use the tutorials forum anymore, in favor of our shiny new WHTwiki.

KDisk, this would make an excellent wiki article. Do you have any interest in posting it there too?


Alex

[darkeden]

Thank you for this, I think this is one of the best guides I have seen.

[Crashus]

Cool guide, thanks

[Stevie21]

Great tutorial!

[dbbrock1]

Yep - a very basic tutorial on how to start a web hosting business. Mind you, you could easily write tons and tons of pages off of the tutorial you have listed.

I like your section about the reasons to start a web host. I will be definitely adding something similar to a page of my course.

[KMyers]

Keep in mind however that the list is not complete, I intend to add quite a bit to it.

[Crashus]

Originally Posted by KDisk

Keep in mind however that the list is not complete, I intend to add quite a bit to it.

I'm personally waiting for that additions.

[QuickWeb-Roel]

This is a great article, i just got a question: I got initially 768MB RAM VPS with 60GB space and 1TB BW sharing a dual xeon box with 8cores.

Can you advice how many account i can provision to sell on the above box w/out overselling?

[RGoulding]

Originally Posted by kabayan

This is a great article, i just got a question: I got initially 768MB RAM VPS with 60GB space and 1TB BW sharing a dual xeon box with 8cores.

Can you advice how many account i can provision to sell on the above box w/out overselling?

There's no magic number - it will totally depend on what size plans you offer.

If you think of your VPS as a pie, you could offer 1 plan with 60GB/1TB, or 60 plans with 1GB/17GB, or 1000 plans with 61.44MB/1GB... You see where I'm going with this right?

Also, the thing that most people seem to forget is you're not only limited by your disk space/bandwidth.

You've also got other technical resources (RAM/CPU) as well as manpower resources - your staff. 1000 of the above mentioned plans may well fit with your HDD/BW allowance, but could you handle 1000 accounts? You'd likely be overselling your support.

[QuickWeb-Roel]

Originally Posted by RGoulding

There's no magic number - it will totally depend on what size plans you offer.

If you think of your VPS as a pie, you could offer 1 plan with 60GB/1TB, or 60 plans with 1GB/17GB, or 1000 plans with 61.44MB/1GB... You see where I'm going with this right?

Also, the thing that most people seem to forget is you're not only limited by your disk space/bandwidth.

You've also got other technical resources (RAM/CPU) as well as manpower resources - your staff. 1000 of the above mentioned plans may well fit with your HDD/BW allowance, but could you handle 1000 accounts? You'd likely be overselling your support.

Thanks that's what i have in mind actually... but do you think assuming that not everyone will maxout their resources it is a considered good practice to oversell by max of 10% only?

let say 66 plans with 1GB/17GB instead of fair equal 60?

I would appreciate feedback from experienced shared reseller too... PM me if you don't want it public.


cheers.