How to start a web hosting company

Tuesday, 17 November 2009

Does starting a web hosting company sound like an impossible dream?  Are you feeling dissatisfied with your current web hosting company, or looking to lower costs?  Or are you just looking for a second income?  If so, then starting a web hosting company might be the solution for you - and it's not as impossible as it might sound.

That said, starting a hosting company from scratch might be beyond your capacities, unless you have serious technical know-how and the finance to set up servers, connections, 24/7 support staff and so on.  Fortunately, there is a much more realistic way, and that's to become a reseller.

Many of the major established hosting companies offer reseller packages.  These involve leasing an allotment of server space and monthly bandwidth for a monthly fee, which you can then sell on to your own clients at whatever price you choose.  You can also rebrand the package, so that it looks like your own product.
One of the things that's attractive about reseller packages is that they require no special knowledge or expertise.  The monthly fee entitles you to full technical support from the parent company.  Your job is simply to find customers to sell the hosting plans on to - and this can be the tricky part of starting a web hosting company.

Web Hosting Business

Web hosting is a seriously competitive business, and it's a very crowded marketplace.  Customers are also very choosy, and quite prepared to take their business elsewhere if they don't get the right service - if you've ever shopped around for web hosting plans yourself, you'll know this to be true.

So attracting customers to your web hosting business involves building a reputation and becoming more visible to prospective clients.  That takes time and effort, or a heavy investment in advertising.
However, don't be disheartened!  A reseller account may not make you a multinational web hosting giant overnight, but you can make some money, and usually very quickly.  

Do you run several websites of your own?  If so, the monthly hosting fees that you pay may well add up to more than the cost of a reseller package.  By becoming a reseller, you can transfer all your domains to your own hosting company, instantly saving money.  If you then went on to sign up some colleagues or friends, you'd be starting to turn a profit on your web hosting.

If you do decide to go down the reseller route, then the best advice is to shop around.  Reseller packages come in all shapes, sizes and prices, so you'll need to find the one that best suits your requirements.  Think about things like rebranding opportunities, billing set up and technical support.  This last one is particularly important - you're the one who's in the firing line if your clients have problems, so you need to know that the technical back-up is reliable and quick.

Starting a web hosting company can be a great choice.  But, like anything else, it involves being absolutely clear about what you want and being prepared to spend some time finding the right deal.