How to Start a Web Hosting Company

How to Start a Web Hosting CompanyEvery day several new companies, online businesses, and web sites are launched requiring web hosting services. The existing sites too need web hosts to remain on the Internet and for other administration purposes. It logically follows that web hosting services are in demand. Interestingly, people think it is profitable and easy to run a web hosting service especially with the freedom of working from home and availability of Control Panels. They forget that working from home in reality requires more dedication and self-motivation to successfully run a business. Moreover, Control Panels may have made the task of hosting sites easy, but they too have their own limitations and are far from accomplishing everything that you need. It is true that web hosting business like any other business is profitable, but to gain these profits one needs to work as hard as in any other conventional setup.Maintaining a successful hosting service is extremely difficult and requires you to be always on your toes. It will take all your time and should not be treated as a part-time arrangement or a secondary mode of income. Understand that the web hosting industry is already saturated. There is no dearth of hosts offering increasingly cheaper and seemingly lucrative offers. Such companies also close down very quickly, but other similar organizations come up in no time. Your competition will always be rough and never decrease in number or intensity. The only way to succeed in such a cutthroat situation is to keep profits low and propose competitive pricing with a high degree of quality service.Start by taking little steps and learn from your mistakes. Discussed in this article are guidelines to assist you in establishing a successful web hosting business.Know Your CompetitionIt is best to begin your company by studying the market and your competition. Investigate the packages other hosts offer and identify the features unique to your web hosting service. Come up with valuable reasons that will encourage people to buy your service. This will help you gauge your competition, the costs involved, and the pitfalls one might come across.Learn the Technology and TechniquesIf you are new to the world of computers and associated technology, you first need to understand the working of computers, networking fundamentals, basic HTML, and security techniques. It would be profitable to gain some relevant experience by working with an already established web hosting company. You should also have some soft skills to help you manage people.If you have some knowledge and work experience then it might be better to resell available web hosting services. The market is full of quality web hosting companies interested in reselling their packages. Working as a reseller allows you to deal with customers as well as business related situations without risking your own investment. Once you are equipped with some experience of running a web hosting service you can venture out on your own with a greater degree of confidence. In any case, you should be well conversant with the popular web hosting servers, applications, security tools, and latest industry trends. Familiarity with technology will help you better understand the business and its nuances, offer superior deals to customers, and troubleshoot when necessary.Calculate Initial InvestmentCalculate your initial investment by considering the costs of hardware and software required. Factors that assist in choosing appropriate hardware and software include bandwidth, average site size, and the type of security you want to offer to your clients. If you want to establish a flourishing web hosting service, you will also need some sort of 24×7 customer support. To accomplish all this, you will need to employ at least a few people. The business will need to be promoted, online and/or offline. In addition, you will need some space where to house all the hardware. Whether you rent or purchase an office area, it will considerably affect the available finances unless you plan to use your garage.Consider all these costs when estimating the money required to start the business. Keep a buffer for unforeseen developments.Write a Business PlanWrite a comprehensive business plan clearly stating your goals and objectives. The objectives you write should be realistic and measurable. For example, hosting five sites within the first six months with timely customer support is an achievable and quantifiable objective compared to the idea of being able to offer the best web hosting service. A well-written business plan explains the services you want to offer through your company. It details all the strategies you wish to implement to handle various operations involved in running the setup. Go through your funding sources, break-even analysis, estimated profits, and the method to manage finances. You should also identify your customers, their requirement, geographic and ethnic origins, and other information that might have an impact on the hosting venture. Prepare a list of prospective clients and the special features that will actually make them your customers. Your clients will primarily be concerned about web site uptime, reliability of service, and quality of customer support. Address these key issues in the business plan.Capture the prerequisites required to become a successful web host and describe the eligibility criteria for hiring employees including their mode of remuneration. Enlist the marketing plans to be used to promote the business. Organize company related information such as web site address, names and bio-data of upper level management, postal address, and telephone numbers(s).In a nutshell, your business plan should be detailed enough to assist you all the way in smoothly running the company. An elaborate business plan will keep you focused all the time and function as guide when resolving crisis.Decide the Next StepAfter a thorough business plan is ready, you are aware of your conviction to become a web host, available finances, and the problems you might face. This means you are in a good shape to start your service, the next step for which is to decide whether to begin by becoming a reseller or leasing dedicated servers. Both these options have their pros and cons, necessitating a careful assessment.Becoming a ResellerRegardless of your financial situation, qualifications, or work experience, becoming a reseller web host is the best option if you are hosting web sites for the first time. Reselling hosting services entails buying large amounts of space on servers of existing hosting companies. In fact, almost all hosting setups offer quite decent reseller plans including access to various administrative panels.By reselling hosting services of an already existing company, you experience it first hand without investing too heavily in it. It gives you the option of winding up the venture with minimum losses if later you find that hosting is not for you. You do not need the extensive technical knowledge as is required to set up a dedicated hosting service. The service provider does most of the administrative operations so you save the time and efforts that go in managing various operations. Reselling is very easy on the pocket with availability of several inexpensive plans ranging from $15-$60, depending on the features you want to offer. On the downside, reselling does not allow you to further resell the service restricting your revenue generation to only serving clients willing to host their web site on your server. Besides, reselling is quite restrictive in nature. You do not have the freedom to alter any server settings. Before becoming a reseller of a particular host, you should carefully check their credentials. Stay away from a host that has been running for only six months. Select a host established for a long time, has positive feedback from its customers, and has an impressive client list. Thoroughly investigate the policies of even a flourishing web host. Check their response time by contacting them through telephone as well as email, both during regular hours and odd hours, including weekends, festivals, and other vacation days. Check out their current web sites to get a feel of their services. If possible, get in touch with some of their existing resellers and clients to estimate their satisfaction levels.Using Partially Dedicated ServersA step further from becoming a reseller is to use semi-dedicated servers, wherein a hosting company assigns you a part of the server. Think of it as a large reseller account in which 3-4 resellers share a server. These are ideal if you need to host large sites requiring low upload time without running the risk of server crashing due to data overload. Because partially dedicated servers give you more space and the liberty to run heavy programs, you need to pay more for them. As is the case with reseller accounts, semi-dedicated servers too give you almost no control over server settings.Using Dedicated ServersAs the name suggests, dedicated servers are hosting servers completely leased to you. You have total control over a dedicated server, which means you are completely responsible for what happens to it. Dedicated servers allow you to host large web sites or communities with several members. Aside from making money by renting out web site space, you can create reseller accounts engaging other people to promote and sell your services.Though dedicated servers seem to offer the absolute freedom, they call for in depth understanding of the prevalent technology. It is also much more expensive than reselling accounts, more so because having a dedicated server requires you to have some physical space to setup the server. You would also need to employ a couple of trained people to help you with day-to-day server administration and management. Dedicated servers are therefore best suited for people with some experience in the business. You can opt for unmanaged or managed dedicated servers. Unmanaged servers are cheaper than the managed ones, give you the maximum freedom to configure the server to suit clients’ needs, and are not equipped with provider supported administrative options. Aside from the basic server maintenance offered by the provider, you are liable for all relevant updates and software upgrades. Needless to say, you should be an expert in server installation, management, and implementation of appropriate security measures or in a position to employ a technically sound webmaster.Managed servers are completely dedicated servers and come with a associated administration package, making them the most expensive deal. You have the freedom to set them up the way you want to and modify their settings according to your requirement.Associated with owning a dedicated server is the issue of co-location. Some people have a dedicated server but are unable to purchase a T1 line to connect it to the network. If you belong to this category and want to start a hosting service, co-location will be ideal for you, in which a datacenter will house your server and connect it to their network line. The advantages and disadvantages of a co-located server are the same as that of an unmanaged dedicated server. Though you are free to configure it as per your needs, you also have to take care of its maintenance or invest in expensive advanced management software and someone who can use the software.Implement Security MeasuresWhen you offer web hosting services, your clients’ web sites will get connected to the millions of computers that form several trusted and untrusted networks constituting the Internet, which is notorious for being highly insecure. Everything passed over the Internet has a probability of being read. To save client data authenticity and for your company to progress rapidly, you must implement appropriate security and data encryption measures. If you intend to use the standard HTTP, then you should at least implement the basic HTTP security procedures such as SSL and TSL. Remember though that networks are not just HTTP based. You will eventually communicate with several types of networks requiring you to implement other security features to assure your customers of a high degree of data security. When creating user accounts, make it mandatory for your customers to create difficult to guess but easy to remember passwords. Set a minimum character limit and prompt them to use a couple special characters. Make the password case sensitive and enforce its regular modification. Depending on the purchased plan, you can assign different permissions and access to the server.Protect data by creating new accounts instead of shared accounts for a set of clients. Maintain the confidentiality of your protected information, especially your password to the system. Never post private information on public sites or forums. Encourage users to abide by the privacy policy and devise a sound backup strategy. Monitor the system diligently and investigate the minutest changes to system files that you did not make or authorize. You should be even more prepared to securely accept credit cards and process online transactions.Offer Customer SupportSomething that your clients would be concerned about before selecting your services is the quality of customer care. To retain maximum customers you must offer 24×7 customer service, which clients can use whenever they face a problem. Lack of always available customer support typically results in prospective clients going to competition. Each customer wants to be given the special treatment with his/her needs taken care of immediately. This means once you start your web hosting company, resolving customer queries will demand a lot of your time. You could very soon be immersed in taking care of your clients if you are unorganized and lack a plan to systematically handle user complaints. You could begin by developing a system, which clients can use to log in their complaints/queries. This could be through email or a toll-free telephone number. Email will be cost-effective, especially when you are a beginner. Toll-free numbers are expensive and though not essential, they do give the impression of a well-established company. It would be valuable to go in for one when you are somewhat more comfortable in the business and have made some money.Begin dealing with customer queries by developing appropriate autoresponders to communicate your acknowledgement of the emailed query to its sender. Without necessitating your availability, an autoresponder buys you some time, establishes rapport with users, and conveys to them that someone is working on their problem. You can then respond to their queries through email or telephone.Later, you can make your services more useful and attractive by including an online chat to provide technical support. Of course, it means investing in relevant software and availability of someone knowledgeable to handle the chat sessions. You might also want to log all these sessions for reference.Register Your Company with the GovernmentA key factor that users look for when scouting for web hosts is the company’s credibility. They want the hosting company to be recognized and well established. The simplest way of gaining integrity for your company is to get it registered with the government. This way prospective clients are assured that you are serious about your business and do not intend to deceive them. Registering your web hosting company as a limited liability corporation (LLC) further fetches you the benefit of legal insurance, which saves you in the event someone files a suit against your company and its services.Promote Your CompanyStarting a web hosting company will by itself be insufficient to bring in the desired revenue. You can however boost sales by advertising about your venture.Create a Search Engine Optimized Web SiteBegin promoting your company by creating a web site detailing various features such as company’s vision, web hosting packages, privacy policy, and the process of handling customer queries. Concentrate on communicating your plans effectively in an appealing way. Identify the keywords that best define your company and business offerings. Make your site search engine optimized by using these terms and phrases frequently throughout the web copy. This will make users comfortable with the site content as these are the terms they would be looking for and simultaneously help web crawlers index your site properly.Avoid using attention-seeking gimmicks that might otherwise be offensive in nature. Use a simple yet attractive web site design, which is easy to navigate and prompts the users to visit other sections of the site. Use graphics only if necessary to support the accompanying text. Devise catchy headlines and topic headings. Always include a sitemap so users can use it to orient themselves. If possible, include a feedback/queries form to collect user comments. Know user preferences by including relevant survey forms on the site and prompting visitors to fill up the form. Strategically showcase your best offers and links to contact information.Be sure to make your site worth the visitors’ time. A site making big promises but lacking in substance is very annoying making the visitors to leave it in no time. It will be much more profitable to have a small site with valuable content than to launch a big site with shallow content.Advertise Adequately and JudiciouslyAfter launching your web site, you need to advertise it aggressively but wisely. When it comes to online marketing, quality supersedes quantity. Advertising your business on few quality sites will bring more customers than promoting the business on several inferior or unrelated sites.Submit your site to popular search engines and directories. Enter beneficial link campaigns with relevant complimentary organizations. If your site is convincing enough, a few first-rate link partners might even agree to one-way linking to your site. One-way inward linking will undoubtedly be more profitable than reciprocal linking.Web crawlers take a lot of time in reaching and indexing your site. While you wait for search engine programs to visit the site, get in touch with its visitors by starting an informative newsletter. Remember to include an opt-in form to explicitly gain users’ willingness to receive the newsletter from you. After the company is a somewhat established, you can try paid placement of your text ads.The sole objective of all the advertising should be to promote the special features of your web hosting plans. People should realize that they would get something additional if they host their sites on your servers. Users today expect more value for their money. Instead of implementing cheap marketing strategies that lay more stress on the business, resort to ideas that address your users and their needs.Reader commentsComment on this article

 

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