Need some advice on starting a hosting business

basehound · December 2020

I'm thinking of starting a hosting service to cater to a very niche market. I'll probably be going with a reseller plan.

Based on my research, it looks like I'll need a billing management system. Billing box seems to be a good choice to begin with.

Apart from billing box and direct admin are there any other is there any other software I need to be aware of ?

Also, could someone share their experience as a hosting provider ?

Intelpentium0 · December 2020

Nice.
Are you sure that your market demand is for shared hosting? Not vps?
You can see in both LES and LET, people were running before VPS deals and hosts like myself struggling to sell discounted shared plans.

If you are going to start it in India, yes, you are right as the target market is shared hosting clients. But I don't know what is needed in your country.

If it's shared hosting, just try to get a reseller hosting and put 1-2 sites for a few months and monitor their uptime.

angstrom · December 2020

Joined 6:04PM

Maybe better not

basehound · December 2020

@Intelpentium0 said:
Nice.
Are you sure that your market demand is for shared hosting? Not vps?
You can see in both LES and LET, people were running before VPS deals and hosts like myself struggling to sell discounted shared plans.

If you are going to start it in India, yes, you are right as the target market is shared hosting clients. But I don't know what is needed in your country.

If it's shared hosting, just try to get a reseller hosting and put 1-2 sites for a few months and monitor their uptime.

There may be some demand for vps, but I prefer to focus on the hosting aspect for the time being.
Also, testing the uptime of the reseller plan sounds like a good idea.

Any recommendations on the software side?

SpryServers_Tab · December 2020

If you're going to focus on shared hosting, I suggest you also offer web design. If not, you're going to seriously struggle to make ends meet.

basehound · December 2020

@angstrom said:
Joined 6:04PM

Maybe better not

I've lurking LES for a month or two, thought I would sigh up to get some advice.

seriesn · December 2020

@basehound said:
I'm thinking of starting a hosting service to cater to a very niche market. I'll probably be going with a reseller plan.

Based on my research, it looks like I'll need a billing management system. Billing box seems to be a good choice to begin with.

Apart from billing box and direct admin are there any other is there any other software I need to be aware of ?

Also, could someone share their experience as a hosting provider ?

Hi there!

Since you have mentioned that you are targeting a niche marketing, I safely assume that you have done the research. Billing software, usually most resellers will offer some form of billing system (for example, we offer blesta). I wouldn’t touch box billing, at its current state, with a foot long pole.

So I come back to you with questions

What makes you stand out?
What will you be doing differently that no one else does in the same zone?

You see, software and hardwares are the easier part of the equation and usually matters the least for most of your end users. Why?

If the website works, no one logs in to a control panel on a regular basis besides when it’s time to pay bill or make changes.

InceptionHosting · December 2020

My advice to you if you want to keep costs low while you learn the ropes is to go to a reputable host e.g. SmallWeb: https://smallweb.net/hosting.html get the cheap reseller plan.

If you want to bill for hosting, then the best supported/documented product with fairly low prices is WHMCS, if you want to save even more money then get Blesta, don't even look at anything else.

if you buy a VPS for your billing panel use NexusBytes @seriesn as they offer free Blesta licenses so you cost is then a VPS from nexusbytes and a reseller plan from SmallWeb, maybe NexusBytes could offer both I am not sure so you are looking at a cost of entry at roughly $15 - $20 /month

Sure there are other ways of doing it but they won't scale, they will get messy and you won't be able to get any help, this way you can learn the ropes for next to nothing.

seriesn · December 2020

@AnthonySmith said:
My advice to you if you want to keep costs low while you learn the ropes is to go to a reputable host e.g. SmallWeb: https://smallweb.net/hosting.html get the cheap reseller plan.

If you want to bill for hosting, then the best supported/documented product with fairly low prices is WHMCS, if you want to save even more money then get Blesta, don't even look at anything else.

if you buy a VPS for your billing panel use NexusBytes @seriesn as they offer free Blesta licenses so you cost is then a VPS from nexusbytes and a reseller plan from SmallWeb, maybe NexusBytes could offer both I am not sure so you are looking at a cost of entry at roughly $15 - $20 /month

Sure there are other ways of doing it but they won't scale, they will get messy and you won't be able to get any help, this way you can learn the ropes for next to nothing.

Wasn’t expecting a mention, thank you sir .

We do offer free blesta with both reseller and VPs plans. .

InceptionHosting · December 2020

@seriesn said:

@AnthonySmith said:
My advice to you if you want to keep costs low while you learn the ropes is to go to a reputable host e.g. SmallWeb: https://smallweb.net/hosting.html get the cheap reseller plan.

If you want to bill for hosting, then the best supported/documented product with fairly low prices is WHMCS, if you want to save even more money then get Blesta, don't even look at anything else.

if you buy a VPS for your billing panel use NexusBytes @seriesn as they offer free Blesta licenses so you cost is then a VPS from nexusbytes and a reseller plan from SmallWeb, maybe NexusBytes could offer both I am not sure so you are looking at a cost of entry at roughly $15 - $20 /month

Sure there are other ways of doing it but they won't scale, they will get messy and you won't be able to get any help, this way you can learn the ropes for next to nothing.

Wasn’t expecting a mention, thank you sir .

We do offer free blesta with both reseller and VPs plans. .

Well, there you go then, a perfect place for the OP to make a start.

basehound · December 2020

@SpryServers_Tab said:
If you're going to focus on shared hosting, I suggest you also offer web design. If not, you're going to seriously struggle to make ends meet.

I've been looking down that path too. But have still not been able to make a concrete decision.

Also, I'm planning to just keep the commitment period to 3 months maximum, before I'm sure about the venture. Will having such a low commitment period have any inverse effect ?

seenu · December 2020

Hey there,
I am into local hosting biz for more than 12 years and your country and YMMV but

no customer logs in or cares about billing panel... they just logs into cpanel when creating emails thats it (also may be installing wordpress etc)
you can use any billing system including open sources ones which are not even related hosting and i just suggest using excel to store details like client, name, plan, price, due date etc... just don't make things complex thinking of perfect setup.

and in case you want to become a reseller online like on LES/WHT/LET etc...don't bother at all.

InceptionHosting · December 2020

@basehound said:

@SpryServers_Tab said:
If you're going to focus on shared hosting, I suggest you also offer web design. If not, you're going to seriously struggle to make ends meet.

I've been looking down that path too. But have still not been able to make a concrete decision.

Also, I'm planning to just keep the commitment period to 3 months maximum, before I'm sure about the venture. Will having such a low commitment period have any inverse effect ?

Well, you mentioned a niche market, so as long as others in that niche do not look to be more stable and committed than you and you believe you have the contacts in a good market segment its worth a try, but don't take more than you can afford to pay back if you decide it is not going to work out.

The beauty of starting with very low costs and the opportunity to expand is that even if it is not working out you should be able to pay for 3 months or so out of your own pocket so you give people plenty of time to move on and you can have a graceful exit.

seenu · December 2020

AND as for experience as provider

Agree with @SpryServers_Tab you need provide something extra like domains, emails and/or designing
Good part is that, even if you do only static sites....some times you get requirements for dynamic sites like ecommerce, news portal kind of sites and if you have design skills...people wil ask you for logos, brochures, flyers etc
especially in India.... with netbanking and UPI...money collection has become dead simple, you don't need to visit clients anymore...just make a call and they send you money...no more cheques too
with players like GoDaddy...ppl ask you..your price is high and GoDaddy offering domain for only $1 etc, so you should explain them how much GoDaddy charging for renewal and how much you are charging

if there is a problem, how easy it is to reach you over phone vs reaching a godaddy support over chat

another argument: GoDaddy giving unlimited space for Rs. 3000 (~$50) then why you are charging XXXX for only 1GB space.... tell above point and also eventhough they say unlimited...they have no.of files limit etc.

see in beginning.....it is tough but then it becomes smooth journey.

Also...networking is important....

i believe in this philosophy
If you customer makes millions, they can give you thousands
if your customer makes peanuts, they give you ....

my standard price is 1GB space per year is Rs. 1000/- ... I am following same mantra for last 14years lol ..No Inflation :P

but i do have very high paying customers too... it all depends on how big is your customer/ customer's company.

hope that helps.

$0.02

basehound · December 2020

@seriesn said:

@basehound said:
I'm thinking of starting a hosting service to cater to a very niche market. I'll probably be going with a reseller plan.

Based on my research, it looks like I'll need a billing management system. Billing box seems to be a good choice to begin with.

Apart from billing box and direct admin are there any other is there any other software I need to be aware of ?

Also, could someone share their experience as a hosting provider ?

Hi there!

Since you have mentioned that you are targeting a niche marketing, I safely assume that you have done the research. Billing software, usually most resellers will offer some form of billing system (for example, we offer blesta). I wouldn’t touch box billing, at its current state, with a foot long pole.

So I come back to you with questions

What makes you stand out?

What will you be doing differently that no one else does in the same zone?

You see, software and hardwares are the easier part of the equation and usually matters the least for most of your end users. Why?

If the website works, no one logs in to a control panel on a regular basis besides when it’s time to pay bill or make changes.

Maybe I should have second look at the billing solution.
I definitely agree with both your questions. I should be looking into adding some value to the table.

gks · December 2020

I like @AnthonySmith view, buy a reseller plan from a good host, sell as your own, if you make profit and love what you doing then you can really think of starting a business. If that doesn't work, transfer customers to host, move on.

gks · December 2020

For quick money and dead pool, there is another forum LEB.

basehound · December 2020

@AnthonySmith said:
My advice to you if you want to keep costs low while you learn the ropes is to go to a reputable host e.g. SmallWeb: https://smallweb.net/hosting.html get the cheap reseller plan.

If you want to bill for hosting, then the best supported/documented product with fairly low prices is WHMCS, if you want to save even more money then get Blesta, don't even look at anything else.

if you buy a VPS for your billing panel use NexusBytes @seriesn as they offer free Blesta licenses so you cost is then a VPS from nexusbytes and a reseller plan from SmallWeb, maybe NexusBytes could offer both I am not sure so you are looking at a cost of entry at roughly $15 - $20 /month

Sure there are other ways of doing it but they won't scale, they will get messy and you won't be able to get any help, this way you can learn the ropes for next to nothing.

I had researched the smallweb reseller plans. They do seem to have good plans for entry level.
Now, I just need to do some more research into blesta and nexusbytes.

Thank you for your inputs.

InceptionHosting · December 2020

@basehound said:

@AnthonySmith said:
My advice to you if you want to keep costs low while you learn the ropes is to go to a reputable host e.g. SmallWeb: https://smallweb.net/hosting.html get the cheap reseller plan.

If you want to bill for hosting, then the best supported/documented product with fairly low prices is WHMCS, if you want to save even more money then get Blesta, don't even look at anything else.

if you buy a VPS for your billing panel use NexusBytes @seriesn as they offer free Blesta licenses so you cost is then a VPS from nexusbytes and a reseller plan from SmallWeb, maybe NexusBytes could offer both I am not sure so you are looking at a cost of entry at roughly $15 - $20 /month

Sure there are other ways of doing it but they won't scale, they will get messy and you won't be able to get any help, this way you can learn the ropes for next to nothing.

I had researched the smallweb reseller plans. They do seem to have good plans for entry level.
Now, I just need to do some more research into blesta and nexusbytes.

Thank you for your inputs.

I assume you feel trying this out is worth at least $20 of your money /month with potentially no return, if that is not the case, just give up now.

I would suggest as you seem to know so little about it, do what many people do offer free or almost free hosting e.g. 1 penny hosting for 3 months, consider yourself 'in beta testing' and learn what can go wrong before you start risking peoples money and your own reputation.

The most important thing to know is: You don't know what you don't know, you will only find that out by trying.

basehound · December 2020

@seenu said:
AND as for experience as provider

Agree with @SpryServers_Tab you need provide something extra like domains, emails and/or designing
Good part is that, even if you do only static sites....some times you get requirements for dynamic sites like ecommerce, news portal kind of sites and if you have design skills...people wil ask you for logos, brochures, flyers etc

especially in India.... with netbanking and UPI...money collection has become dead simple, you don't need to visit clients anymore...just make a call and they send you money...no more cheques too

with players like GoDaddy...ppl ask you..your price is high and GoDaddy offering domain for only $1 etc, so you should explain them how much GoDaddy charging for renewal and how much you are charging

if there is a problem, how easy it is to reach you over phone vs reaching a godaddy support over chat

another argument: GoDaddy giving unlimited space for Rs. 3000 (~$50) then why you are charging XXXX for only 1GB space.... tell above point and also eventhough they say unlimited...they have no.of files limit etc.

see in beginning.....it is tough but then it becomes smooth journey.

Also...networking is important....

i believe in this philosophy
If you customer makes millions, they can give you thousands
if your customer makes peanuts, they give you ....

my standard price is 1GB space per year is Rs. 1000/- ... I am following same mantra for last 14years lol ..No Inflation :P

but i do have very high paying customers too... it all depends on how big is your customer/ customer's company.

hope that helps.

$0.02

Thank you, that was good insights. Maybe I should look into adding some bundled services.

basehound · December 2020

@gks said:
I like @AnthonySmith view, buy a reseller plan from a good host, sell as your own, if you make profit and love what you doing then you can really think of starting a business. If that doesn't work, transfer customers to host, move on.

That's the only reason I've thought about going with a reseller plan; don't want to leave people hanging without any way out.

basehound · December 2020

@AnthonySmith said:

@basehound said:

@AnthonySmith said:
My advice to you if you want to keep costs low while you learn the ropes is to go to a reputable host e.g. SmallWeb: https://smallweb.net/hosting.html get the cheap reseller plan.

If you want to bill for hosting, then the best supported/documented product with fairly low prices is WHMCS, if you want to save even more money then get Blesta, don't even look at anything else.

if you buy a VPS for your billing panel use NexusBytes @seriesn as they offer free Blesta licenses so you cost is then a VPS from nexusbytes and a reseller plan from SmallWeb, maybe NexusBytes could offer both I am not sure so you are looking at a cost of entry at roughly $15 - $20 /month

Sure there are other ways of doing it but they won't scale, they will get messy and you won't be able to get any help, this way you can learn the ropes for next to nothing.

I had researched the smallweb reseller plans. They do seem to have good plans for entry level.
Now, I just need to do some more research into blesta and nexusbytes.

Thank you for your inputs.

I assume you feel trying this out is worth at least $20 of your money /month with potentially no return, if that is not the case, just give up now.

I would suggest as you seem to know so little about it, do what many people do offer free or almost free hosting e.g. 1 penny hosting for 3 months, consider yourself 'in beta testing' and learn what can go wrong before you start risking peoples money and your own reputation.

The most important thing to know is: You don't know what you don't know, you will only find that out by trying.

Having a testing phase could actually be beneficial. I could try things out, while getting feedback from the users.

Not_Oles · December 2020

@AnthonySmith said: offer free or almost free hosting e.g. 1 penny hosting for 3 months, consider yourself 'in beta testing' and learn what can go wrong

Hi @basehound !

I was one of those who started by giving away free VPSes. If you wish, you maybe can look back in the "Free" category and see my original posts. It was a great experience! I got a lot of help from really great folks! [Thanks again @david, @seriesn, @Mason!] I learned a lot! I know I still have a lot more to learn! But it's fun!

As a beginner, I had trouble understanding the differences between being here as a buyer and being here as a seller. Here you find a whole bunch of rollicking, tech savvy, super-friendly, honest, and helpful, but cheap buyers. I myself am a proud member of the cheap club, possibly except for the tech savvy part. Folks here as buyers want the least expensive, especially if it's also tech fun, like NAT VPSes, and Wireguard, and reseller upon reseller, and micro instances, and having a world wide network for $7 per month.

So I came here as a buyer. And now I am a seller! Two quite different perspectives!

I hope you have as much fun here as I do! See, in this thread, people already are helping you!

rcy026 · December 2020

@basehound said:
Maybe I should look into adding some bundled services.

If you are selling shared hosting, that is basically the only way to make money.
I recently signed up for lifetime shared hosting, 2GB space, unlimited emails/domain/bandwidth and free support, for the somewhat insane price of €9.99. Let that sink in for a moment, a one-time fee of €9.99 for lifetime hosting!

I hate to be the buzzkill here, but there is no money in shared hosting. As mentioned earlier, you have to bundle it with webdesign or vps or some kind of other addon to get any money at all from it.

MichaelCee · December 2020

@AnthonySmith said:
I assume you feel trying this out is worth at least $20 of your money /month with potentially no return, if that is not the case, just give up now.

This. There's never a guarantee for profit so you need to essentially set a budget you'd be okay with burning. My first company came through at around £200 profit after the first year which should have been extremely unlikely considering how amateur hour my spending was. To make that was essentially luck. I would have been okay losing hundreds and potentially thousands and I'd still be okay losing thousands with my current company to continue developing skills, gaining experience and at the end of the day to provide a service I believe in to people I find.

@basehound said:

@gks said:
I like @AnthonySmith view, buy a reseller plan from a good host, sell as your own, if you make profit and love what you doing then you can really think of starting a business. If that doesn't work, transfer customers to host, move on.

That's the only reason I've thought about going with a reseller plan; don't want to leave people hanging without any way out.

A reseller plan would be my recommendation if you're not 100% sold on the idea. But as mentioned learning is a key part of this industry and I think whether you go on to sell your own packages or just research the market and software involved I would personally see it as a good investment either way. It doesn't have to be from me either. I think if you plan to have a presence online (whether as a hosting company or other) then getting to grips with a virtual server could save you a lot of time down the line too. Either is a good shout.

Intelpentium0 · December 2020

@basehound said:

>

There may be some demand for vps, but I prefer to focus on the hosting aspect for the time being.
Also, testing the uptime of the reseller plan sounds like a good idea.

Any recommendations on the software side?

If you are asking about billing software, I am a bit biased towards whmcs. I tried Blesta last year, but couldn't get it easy as whmcs.
It will be nice if you start in Blesta from your first client onwards. It will be difficult to forget your first love.

Set up your billing emails with mxroute or sendgrid.

Most clients login to cpanel through billing panel and as @seenu said my price per gb is also Rs.1000. It's not a bad price when you offer personal support whenever needed.
Also you can create websites (may be WP) for clients by charging Rs.6000 for a package that includes 1 or 2gb space, a domain and 1 year maintenance. I charge them 50% from next year onwards including domain+hosting renewal. But make sure to login to those WordPress administration and update themes/plugins periodically.

iVlad · December 2020

I have been in the hosting business for over ten years, so here are my two cents. If you want to start this path in web hosting, consider this. The web hosting industry is severely saturated. Everyone can run a hosting company. But a few can adequately run it and survive the first two years.

Find a niche market. I don't mean to be harsh, but just running a shared hosting won't get you far. What makes you better than the rest? What do you offer that most people don't already provide? These the questions that you have to ask yourself.

Start local. You would be surprised how much business you can get just around the block or down the street. Find Facebook groups or Reddit threads that focus on local business around your city. Learn from them and listen to your market.

Start small and grow. As others have stated, get a reseller hosting from a good provider.

You will fail, and then you will succeed. You will make many mistakes, but you will learn from them, and you will push on to greatness.

Good luck.

basehound · December 2020

@Not_Oles said:

@AnthonySmith said: offer free or almost free hosting e.g. 1 penny hosting for 3 months, consider yourself 'in beta testing' and learn what can go wrong

Hi @basehound !

I was one of those who started by giving away free VPSes. If you wish, you maybe can look back in the "Free" category and see my original posts. It was a great experience! I got a lot of help from really great folks! [Thanks again @david, @seriesn, @Mason!] I learned a lot! I know I still have a lot more to learn! But it's fun!

I was reading your "what I learned" post. It was a good learning experience. Hope to replicate that!

As a beginner, I had trouble understanding the differences between being here as a buyer and being here as a seller. Here you find a whole bunch of rollicking, tech savvy, super-friendly, honest, and helpful, but cheap buyers. I myself am a proud member of the cheap club, possibly except for the tech savvy part. Folks here as buyers want the least expensive, especially if it's also tech fun, like NAT VPSes, and Wireguard, and reseller upon reseller, and micro instances, and having a world wide network for $7 per month.

So I came here as a buyer. And now I am a seller! Two quite different perspectives!

That's a good point; to look at from a buyer's perspective. Thank you.

I hope you have as much fun here as I do! See, in this thread, people already are helping you!

I was surprised by how helpful LES is. I was expecting a lot of users to be dissuading. But It was quite the opposite. Everyone's ready to share their experiences.

basehound · December 2020

@rcy026 said:

@basehound said:
Maybe I should look into adding some bundled services.

If you are selling shared hosting, that is basically the only way to make money.
I recently signed up for lifetime shared hosting, 2GB space, unlimited emails/domain/bandwidth and free support, for the somewhat insane price of €9.99. Let that sink in for a moment, a one-time fee of €9.99 for lifetime hosting!
I hate to be the buzzkill here, but there is no money in shared hosting. As mentioned earlier, you have to bundle it with webdesign or vps or some kind of other addon to get any money at all from it.

Even I grabbed one of the lifetime offers from MikePT. It was just too tempting to pass.
Though, you are right about the competition in this space. But the market I'm trying to go after is too niche and just trying to focus on a local scale.
The bundled services could be a great way to stand out.

basehound · December 2020

@SmallWeb said:

@AnthonySmith said:
I assume you feel trying this out is worth at least $20 of your money /month with potentially no return, if that is not the case, just give up now.

This. There's never a guarantee for profit so you need to essentially set a budget you'd be okay with burning. My first company came through at around £200 profit after the first year which should have been extremely unlikely considering how amateur hour my spending was. To make that was essentially luck. I would have been okay losing hundreds and potentially thousands and I'd still be okay losing thousands with my current company to continue developing skills, gaining experience and at the end of the day to provide a service I believe in to people I find.

Agreed. That's the reason I'm not even trying to have any long term commitment plans.

@basehound said:

@gks said:
I like @AnthonySmith view, buy a reseller plan from a good host, sell as your own, if you make profit and love what you doing then you can really think of starting a business. If that doesn't work, transfer customers to host, move on.

That's the only reason I've thought about going with a reseller plan; don't want to leave people hanging without any way out.

A reseller plan would be my recommendation if you're not 100% sold on the idea. But as mentioned learning is a key part of this industry and I think whether you go on to sell your own packages or just research the market and software involved I would personally see it as a good investment either way. It doesn't have to be from me either. I think if you plan to have a presence online (whether as a hosting company or other) then getting to grips with a virtual server could save you a lot of time down the line too. Either is a good shout.

I feel the reseller plan is the only good way to start. I may still have some doubts about starting this venture. But the learning experience would be worth it.

basehound · December 2020

@phxwolf said:
I have been in the hosting business for over ten years, so here are my two cents. If you want to start this path in web hosting, consider this. The web hosting industry is severely saturated. Everyone can run a hosting company. But a few can adequately run it and survive the first two years.

Find a niche market. I don't mean to be harsh, but just running a shared hosting won't get you far. What makes you better than the rest? What do you offer that most people don't already provide? These the questions that you have to ask yourself.

Start local. You would be surprised how much business you can get just around the block or down the street. Find Facebook groups or Reddit threads that focus on local business around your city. Learn from them and listen to your market.

Start small and grow. As others have stated, get a reseller hosting from a good provider.

You will fail, and then you will succeed. You will make many mistakes, but you will learn from them, and you will push on to greatness.

Good luck.

Those are some good points. I do plan to keep it constrained to a niche group, but listening to the feedback from Reddit threads and Facebook groups can be a great start. Thank you.

Need some advice on starting a hosting business

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