Setting up a hosting company

Discussion in 'Web Design and Development' started by jdl8422, May 9, 2008.

  1. jdl8422 macrumors 6502

    jdl8422

    Joined:
    Jul 5, 2006
    Location:
    Louisiana
    #1
    Well I currently work for a company that is branching out into small business solutions. The company already does web design and graphic design, but they wanted to be able to offer hosting services for business. This will more than likely start out small. Obviously they are not going to start out as big as someone like godaddy.com. Well they asked me if I knew anything about it. I didnt. So, for my own curriousity and to help them out. What all do you need. I am familiar with setting up sites to be hosted, and I have a gernal idea of what goes into it, but what do you need to get started, other than some computers. Also, what all goes into selling domain names to go along with the hosting accounts. Thanks
     
  2. Cabbit macrumors 68020

    Cabbit

    Joined:
    Jan 30, 2006
    Location:
    Scotland
    #2
    Perhaps starting out with a reseller account from one of the bigger players. Market the service and see if anyone bites, buy more server space from the main host as required and when business grows to demand your own servers and dedicated lines and storage and fire proof backup solutions do that then.
     
  3. jdl8422 thread starter macrumors 6502

    jdl8422

    Joined:
    Jul 5, 2006
    Location:
    Louisiana
    #3
    I saw the reseller stuff online, I was just curious why we would go through a reseller. It seems like the client would just cut us out. I do understand what you are saying about starting out small though. Thanks
     
  4. Darth.Titan macrumors 68030

    Darth.Titan

    Joined:
    Oct 31, 2007
    Location:
    Austin, TX
    #4
    I agree that a reseller is the best option. From what it sounds like, you don't have the knowledge or experience to maintain a web server hosting other people's sites. There are a million configuration options to worry about, not to mention bandwidth and uptime concerns.
    In my opinion web hosting is not a good small business opportunity. It really is best left to experienced providers.
     
  5. taylorwilsdon macrumors 68000

    taylorwilsdon

    Joined:
    Nov 16, 2006
    Location:
    Bay Area
    #5
    I ran what became a fairly large hosting company for about 2 years. Feel free to PM me if you have any questions. I can't say for sure if whatever contacts I made in the industry would still be helpful, but I'd like to think I know my stuff.

    I'm also currently employed by a hosting company.
     
  6. naftalim macrumors 6502

    Joined:
    Sep 18, 2007
    Location:
    Vancouver, BC
    #6
    I was an executive at a large hosting company for several years (we did start out small):)

    You actually might become a reseller instead of using a reseller. The reason large hosting companies want you as a reseller is that you offer the other ends of the web presence that they don't that, is personal design and service. The benefit to you in using a large host is that for a small price you have access to all their infrastructure, redundancy, security and fire protection as well as 24/7 monitoring.

    The hosting you offer can start off as shared hosting, and then if you get bigger, you can get a dedicated server which gives you more control, more bandwidth and better security. Later on you can collocate your own servers and run the hosting off them. This will give you the flexibility to offer packages that you create and not those of the host.
     
  7. ChicoWeb macrumors 65816

    ChicoWeb

    Joined:
    Aug 16, 2004
    Location:
    California
    #7
    Are you sure it's worth it :) That's my advice from a business who does the exact same thing you just menetioned, web and graphic design as well as hosting. I do it more as a service because it sure as hell doesn't make much money on a small business scale. You'll obviously need your own dedicated server, you'll need someone to administer it, because now you are responsible for other peoples revenue streams. And when the phone goes off at 3am, guess who's up troubleshooting with the admin! It's worth it to retain your customers so they don't go elsewhere, but if you're doing it to make money, it's probably not going to happen.

    A little background on us, we manage about 5 dedicated servers. We stay competitive with the prices, but our net proceeds at the end of the year, aren't nearly worth the headaches :)
     
  8. Dimwhit macrumors 68000

    Dimwhit

    Joined:
    Apr 10, 2007
    #8
    If it's set up correctly (with custom nameservers, etc.), your client will never know you're reselling. But if that's a worry, you could always buy/rent servers straight from a data warehouse, which is what some of the smaller hosts do. But then you have to deal with all the hosting/server software setup and maintenance, whereas if you resell space, you won't have to.

    Also depends on how much your company is willing to spend on the hosting.
     
  9. operator207 macrumors 6502

    Joined:
    Jul 24, 2007
    #9
    I agree with the above statements. I worked for an ISP for 9.5 years, 6 of those were as one of 3 people that *was* the business dept. We did ISDN - DS3 support along with webhosting. We did this on multiple platforms from Straight windows or linux/FreeBSD hostings, to Plesk on Windows and Linux/FreeBSD. We LOSt money on the hosting in terms of support of the customers, but we kept it specifically because of this all-in-one crap other bigger companies are doing, and our customers were leaving. We would make $700 a month on a $850 a month connection to the internet, and literally lose in support tech wages alone $50 - $100 a month on supporting that custmer's Frontpage designed webpage, or their friend the "web designer", and his calls to support.

    I do not work for that ISP anymore, but I have a few friends left. They are right now trying to farm the hosting to another company.

    Which brings me to my idea. See if you can find a small ISP locally that has a business dept they want to get rid of. If you want to get close to making any sort of profit any time soon, you need bulk customers fast. See if you can buy another companies Web Hosting book of business. You get an immediate customer base you can convert into customers, and you get servers that are (hopefully) decent. Of course, you may be in for a big headache doing this, or just trying to be a hosting company at all. I handled at least 5 integrations for my old company (handled as in beginning to end, not just delt with the customer's issues, I did that too) and each was a big PITA at some stage. Either finding out the servers sucked, or that the customer's were never paying, and now had to.

    In this current market for web hosting, you have 2 choices. Figure out how to sell a quality product really cheap, and make a little bit of money, or sell a product and fail.

    If its crap, your going to fail. If its too expensive, your going to fail. If its cheap but decent, you might succeed.

    Also, customers in need of web hosting are really finicky. They will walk away for a misspoken sentence, and by nature of web hosting, you do not have the chance to resolve the problem, as they have moved on, and are just calling to make sure they do not get billed again. The service is already gone.

    I would support 1000's of T-1 customers by myself, if it kept me away from Web Hosting customers. They pay me a 3 to 4 digit dollar amount every month. They complain only when its down. The web hosting customers pay me a 1 digit dollar amount, and complained every week or so. Sites not fast enough, site is down for maintenance, I want credit. Site does not support this script some guy wrote. Etc.
     
  10. jdl8422 thread starter macrumors 6502

    jdl8422

    Joined:
    Jul 5, 2006
    Location:
    Louisiana
    #10
    Thanks for all the replies, There are obviously alot of people out there who know what is going on lol. I mostly asked the question for my own personal knowledge. I really do not know what the company plans on doing. I know they arnt doing it for money. Its mostly just to have the clients stay with them for everything. Thanks again everyone.
     
  11. ChicoWeb macrumors 65816

    ChicoWeb

    Joined:
    Aug 16, 2004
    Location:
    California
    #11
    Then you should do it. Customer retention is key. Plus, they'd rather give you the money then GoDaddy. I can't think of one time someone has decided to purchase a website from us, and not go with our hosting, UNLESS they have a previous host. Get a medium dedicated server, something you can do for about 250 bucks a month from www.softlayer.com (Get whm and cpanel), then read webhostingtalk.com, and find yourself a good admin for the $100 a month range, you should start off nicely.
     

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