Best Way to Start a Website Hosting Service?

Kwirl writes "Lets say that I wanted to start a small business endeavor, namely reselling my server space and offering pre-built websites. What resources would I need to start something like this on my own? What hosting service would best suit those needs? What would be the best way to manage a subdomain-level service that provided a basic forum, registration, a web site and some controlled administrative access for my friends so they couldn't easily terrorize each other? I'm curious to know if I could start something like this on my own, and without much more than just my own server space, time, and creativity. I'm not looking to make a living out of this, its mostly just a way for me to more efficiently manage having several friends each wanting me to built or run a web site for them, and perhaps make some small residual income if a market exists. The Slashdot community represents such a broad swath of experience and expertise that I'd like to know how you would approach a project of this nature."

Comments

How to succeed in 10 easy steps

[name*censored*]

1) Line up a patsy
2) Get some matches/lighter/firestarters
3) Burn down all competing datacentres in your city
4) Set up a webserver company

Seriously though, it's an incredibly overcrowded market - if you have an idea on something new or innovative to offer, then by all means go for it. But as they say, there's nothing new under the sun, and you'd have much better luck trying to compete within a market that isn't so overcrowded. Professional encryption/sensitive data management perhaps?

Re:How to succeed in 10 easy steps

[Anonymous Coward]

1) Line up a patsy

2) Get some matches/lighter/firestarters

3) Burn down all competing datacentres in your city

4) Set up a webserver company

Seriously though, it's an incredibly overcrowded market - if you have an idea on something new or innovative to offer, then by all means go for it. But as they say, there's nothing new under the sun, and you'd have much better luck trying to compete within a market that isn't so overcrowded. Professional encryption/sensitive data management perhaps? Professional encryption/sensitive data management perhaps?

Yeah, because that's a great field if you don't know what you're doing.

Re:How to succeed in 10 easy steps

[WereCatf]

Seriously though, it's an incredibly overcrowded market - if you have an idea on something new or innovative to offer, then by all means go for it. But as they say, there's nothing new under the sun, and you'd have much better luck trying to compete within a market that isn't so overcrowded. Very true. There exists about a gazillion different website hosting services, some even offer to do it for free if the site is static. I've seen some offer like 15e per year with full SSH access, PHP and such. So I just wonder what does the OP think he can offer that someone else doesn't already, and for a cheaper price?

Re:How to succeed in 10 easy steps

[erroneus]

I think that's kind of the consensus here. The OP doesn't know that the 90's are long past and that once hot market is now saturated. There's only one chance any such endeavor could really work out and that where he simply knows enough people or knows enough people that know enough people to really trust this person with their site and doesn't care that there are services out there that will do it better and/or cheaper and that the number of subscribers is high enough to at least break even. All of that, in and of itself, is pretty difficult if not improbable.

I would recommend that this guy volunteer or intern with a hosting company to see what it's like and what the real challenges wind up being.

What I would be inclined to do is something a little different. I would set about getting people to buy their own gear and help them set it up at their own location. Perhaps it's ultimately as unworkable as building your own hosting facility, but at least in this case, the risk is distributed among the subscribers and since they would actually own and control their own boxes, they would feel less risk for themselves as well.

So what you end up with is they buy their own server hardware, power management and internet connection, you set up the software and remote access and management stuff, collect fees for getting it set up and arrange for maintenance fees monthly. The risk is all on the client, then, but as long as you are very open with them, you will retain them with a comfortable trust relationship because they know if they think they are getting screwed, they can get someone else to take over... and when they realize they weren't, they can come back to you at will. Meanwhile, your overhead is VERY very low, and when things go wrong at THEIR site (you know, like power or internet link), you aren't quite at responsible.

For small operations, business class broadband makes this a very workable possibility. Further, if an operation feels like they need a little more, then arrange to set up some hosts that, once again the client pays for, at a co-location facility. You take the lead as the technical contact, but the owner is the owner taking all of the risk and responsibility.

The one thing an operator like this can offer that the big, market-saturating hosting companies can't is a personal trust relationship allowing the client to be in as much control as they feel comfortable accepting. And if they won't accept enough control, you probably don't want them as a client anyway since they are probably looking to abuse you and point fingers at you when things go wrong.

Re:How to succeed in 10 easy steps

[lukas84]

Symantec has proven that you can make alot of money on that market without a decent product.

just don't

[debatem1]

If you don't know the answers to these questions, don't get paid to know the answers. You don't want to be a knowledge worker and learning on the job. If I were you, I'd do it for the fun of doing it until you answer more questions than you ask on the forums for the technologies you're using, and swallow the costs in the meantime.

Think *very* hard before you do this

[wrook]

My ex boss (in a *very* small company) did this for his friends/business associates. It's a royal PITA. Unless you *can* make a living off of it (and have a good business plan that convinces you it's feasible), I would recommend not doing it.

It sounds easy at first. How hard is it to just whack up a couple of simple web pages for a couple of buddies? Lots of us have one of our own and it takes almost no maintenance.

But what happens when your buddy starts to attract some undesirable attention? For example, maybe you buddy has a car dealership and just wants a quick and dirty website. But he pisses a script kiddie who then spends the next year trying to pull down your server.

Or what happens if the site goes down at 3 am and your buddy just *has* to have it up and running?

Or what happens if your buddy decides he just *has* to send emails from his website when someone clicks on something, and you discover that the package you are using has about a million vulnerabilities and you are now the biggest spam king in the US?

Honestly, it just sucks. Buddies who can't set up their own website are almost always unreasonable. And they will expect "professional service" even if you don't charge them. And they will bug you continuously for completely boneheaded things having to do with their site.

Unless you really don't like sleeping, I recommend backing away from this idea.

Re:Think *very* hard before you do this

[Bashae]

I've had this experience before. Some people, who you may even have known for a long time - they can even be your friends - think that paying you peanuts for a small website and hosting means they have bought your body and soul and you must be available to work on their "small" changes or to fix their "little" problems at all times.

However, not all people are like that. I suggest writing a good disclaimer/ToS and choosing the people who you're going to allow to use the service carefully.

Re:Think *very* hard before you do this

[Anonymous Coward]

Absolutley.

Every friend who has ever asked me for help setting up a website has been even more of a pain in the arse than friends who want their warezed windows machines sorting out. At least you can tell the broken PC people to go to fucking PC World and give them 20 quid to fix it. Once you build a small site for someone, you're stuck with a constant stream of improvements and problems, and there aren't many good ways of getting them to go somewhere else without damaging your relationship with them. Even when you give someone webspace for free they can be astonishingly grumpy when there is an outage.

Hosting a few sites makes almost no money as there are already companies that do this for £3/month or so.

I strongly recommend helping your friends find other people to host their sites - show them googlepages or something like that. Find them other people to do the grunt work building their sites.

Enjoy your free time!

Re:Think *very* hard before you do this

[erikina]

Agree, although for me it has never got to the point of having my sleep interrupted. For a small amount of money ($70 - $200), I've setup a number of websites.

Their pages don't generate much traffic, so I said I'll host it for them and never discussed ongoing maintenance and changes. It's really been terrible. I get emailed (even phoned) all the time (esp. the guy that paid $70). Every week he'll wants something changed, or something modified.

I ended up drawing the line when he decided he wanted fancy roll-over menus instead of the current very functional one. I gave him a (large) quote just cause I was sick of it. We never spoke much after that.

With another, the business (who the site was for) was sold - so when I got in contact with the new owners. I told them, I'd continue to host it and charge a straight amount if he contacted me about the site and plus an hourly rate.

He thought it was very reasonable (after all, isn't it?) and actually has never bugged me once about anything.

The lesson is if you're going to setup a website, make sure you arrange the terms of ongoing maintenance. There's going to be a lot of it (esp. if you're doing it for free).

The other lesson would be don't do deals with friends. You'll both have completely different expectations of each other - and very well might ruin your friendship over it (unless you're a better person than me, and enjoy helping more than I do).

These days, if people want me to do any work - I tell them I don't know how. It really isn't worth it.

Here's a tip...

[syd02]

If you want to make a small fortune, start with a large one.

Ran my own hosting company...Now i'm in catering!

[Anonymous Coward]

I did this for a couple of years. And the conclusions I came to were that:-

1. No money in simply hosting sites on a small scale
2. If you offer hosting, over sell your server capacity by at least a 1000% or you will never attract customers. They hardly ever use more than 1% of what they sign up for and won't sign up unless your storage/bandwidth offer is as ridiculous as everybody else.
3. Convert your hosting clients to higher value customers by offering web/graphic design opt-in email marketing services etc.
4. Either write your own services/management systems, keep your free software updated religiously or plan for the day when your free software is exploited and your server is owned by a couple of kids. When this happens your server will get null routed your customers will be angry and you will spend a couple of days at least recovering (damn OpenWebmail!)
5. Be prepared to answer support calls any time any place, no matter what crisis your life is in. Imagine troubleshooting a technical problem whilst on a stag weekend in Dublin!

If you can't do all this yourself, you need a pot of money to get a good team who can, but don't expect to make a good profit unless your added value is exceptional.

I got out of pure IT all together, I've found that it's far easier to get a traditional business off the ground and with the skills I've got my new company is light years ahead of the competition. How many small catering businesses do you know of that have 1TB File Server, there own dedicated web/mail server, asterisk PBX with VOIP/POTS lines etc, and a dedicated 24/7 tech support person with excellent dish washing skills?

Re:Plesk

[bloodninja]

1. Don't I also clicked here just to say don't. Not unless you have: 1) Lots of experience administrating webservers. 2) A big fat pipe to the 'net. Both ways, not simply ADSL 3) Lots of hair on your head. Or none. Lots of hair will give you something to pull on. If you have none, then you won't loose anymore anyway. 4) Time and patience. Your users _will_ try to terrorize each other. And they will be attacked from outside. And their accounts _will_ be compromised. You will be to blame. Your best bet is to resell hosting from a managed provider, on their servers, with their tech support.

Not worth it.

[Purity Of Essence]

I make all my clients pay for their hosting and domains themselves. I'll generally set them up with someone good, and then drill into their heads how important it is to pay the bill on time when it comes around next year. I tried the reseller thing and it is too big a pain in the ass to track down all the money. You end up doing all the work and taking all the risk. Screw that. Leave it to the professionals and focus on site design and implementation.

Re:Plesk

[vux984]

I think the web-hosting market is quite saturated.. Unless you have some brilliant idea or you have superior hardware and very cheap price, you will not attract customers.

You simply aren't going to be able to compete with a $4.00/month multi-gigabyte hosting plan of which there are several. So don't try. Might as well try to open an independant drug store next to walmart.

Go the other way, find a niche that's NOT served by those guys and go for that.
Go after the people who need something unique and specialize in it.

Re:Plesk

[SausageOfDoom]

Systems like that also do all the hard work for you - which is great if you know what you're doing, but otherwise when you run into a real problem, or if Plesk goes wrong, you have no idea what to do next.

I agree with the original comment of "dont", as far as setting up your own server at least.

Don't, because the market is full of bedroom hosts who don't know what they're doing.

Don't, because unless you're going into it seriously (and by that I mean investing time and money heavily, hiring enough staff to provide 24/7 support and decent SLAs, and charging appropriately serious money), the margins have to be so low to be competitive that you're losing money when the customer submits more than one ticket a year. Which they will do, because they've come to you, which means they don't know what they're doing.

But most of all, don't, because if you have to ask how to do it, you shouldn't be doing it. You really can't be going into this if you have so little understanding of the issues involved in running a server and the associated services that you need to ask. It's not fair on your paying customers, because when they have a problem, you won't be able to help.

If you want to resell space, do just that - go find a company dedicated to selling reseller accounts. They will give you a whitelabel reseller account and look after all the server issues themselves, leaving you free to pimp out the space.

If you do, just make sure you have an exit strategy, tied to some kind of dead mans switch (even if it's just leaving details with a friend) - I've heard of far too many resellers disappearing, leaving the customers unable to get access to their sites, and the resellers in a difficult position as they should have no direct contact with the end customers.

Re: phone calls from people who hadn't paid ...

[TaoPhoenix]

Got it!

Make the support # 1-900!

If they don't bother to pay but then they call to whine, you get your money back. It gets charged to their phone bill, and they probably don't look at that either.

If they can handle themselves silently, they "stay cheap".

If they call knowing it's a charged call but they're screwed and need help, then it's an even-handed deal. ... Oh well, it was a fun thought.

Re:Most of these responses are from losers and foo

[Anonymous Coward]

Unfortunately it's not the kind of advice that Kwirl needs. He's looking for some way to host web sites for his friends and make "some small residual income if a market exists." That is what the negative posts were right to latch onto. He's setting himself up for heaps of unpaid or low paid work. The only sensible and sustainable way to approach web hosting is from the business side, and that means you look for a market first. Note that the exception to the naysaying comes from a person who is not in the typical age group and uses Frontpage. He's obviously not in the business of providing web hosting to his friends. He's not the guy who could fix your computer blindfolded. His priority is to be a reliable business partner. In business speak: You have to provide solutions, not just web hosting. What the other comments are telling you is that it's most likely a good idea to outsource the web hosting part of your solutions, because that is not where the money is made.