Let's build a web hosting business on a shoestring

Income Calculation & Growth Strategy

Well, you probably want to know if web hosting is rewarding and how much money can you make. Here is the information you might be looking for. For our calculation we calculate an average of $5.00 actual revenue from each client accross the board. From our own experience we know that this value actually represents a very possible amount of income from each client - after cost. Of course - if you are able to work your market with a little higher prices you will be able to get even more from each customer. We also list

How fast will you get there? That depends on how you bring your business to the market and what pricing model you choose. The first 50 clients are the most difficult ones to get. After that it gets much easier as word of mouth advertising kicks in. Is it very difficult to get 500 clients or more. Yes and No. You will have to be dedicated to your business and you will have to provide first class customer service to get there.

Here is a chart which shows the approximate growth that you can expect if you invest/reinvest money into advertising and marketing:

As you can see - you have to expect that it will take about 8 months to get about 100 clients to sign up for your services. Your overall mileage will vary. Some folks need much longer to get there - others are really good in selling their services and will grow faster than anticipated.

The nice thing about running a web hosting business - in many cases you can start part-time and do not need to quit your job. This will allow you to re-invest most of the money that you make.

Growth Strategy

We often see businesses grow like crazy and the owner living about his means. A good solid business is not being build by spending money on personal life style. We will show you a rock solid strategy to build your business properly and create value. We will assume that you still hold a job or have a spouse or family support you.

1) Re-invest as much money you possibly can. Re-investing the money will allow your business to grow faster.
2) Spend your money wisely. Spend the money on selective advertising and to improve your quality of service.
3) Build up a cash reserve. As more money you can put aside as faster you will be able to work full-time for yourself. Your cash reserve can substitute your income for a while for the time of transition from employee to employer.
4) Avoid unnecessary expenses. Do not buy that new shiney company car you always wanted and do not buy the newest gamer computer with 2 Gig of Ram. Every dollar you spend on items not needed to improve your business will make it more difficult for you to succeed.
5) Get help when your service level suffers. No one person alone can support 1,000 clients. At one point you will need help. Hire support staff or outsource support. This will set you back a little bit in regards to monthly revenue but in the long run it will help to make your business more stable and therefore more valuable. You can stay on reseller hosting accounts for a long time - this will minimize your need for support. Just upgrade the accounts or get additional ones - preferable on different servers so that not all your clients are affected if a server goes down for maintenance.
6) Spread the risk. Split your clients onto different reseller accounts on different servers. Eventually use different providers in different data centers. Do not put all eggs into one basket.
7) Slow down the growth if your overwhelmed. It is better to take down your signup for a few days and work out problems or hire staff (or outsource support). Your clients and future clients will actually see this as a sign of responsibility and will trust you even more.
8) Again - re-invest the money you make into your business and also build up a higher cash reserve.
9) Advertise, Advertise, Advertise.
10) Learn. Invest time into business and technical related information. Study this stuff and read books or websites. This is the best way to add value to your business.
11) Once your business reaches a certain level and requires more attention, but does not fully support you yet - get a part-time job instead of your full-time job. Even if you make less money from the job for a while, the additional time spend on your business will actually speed up things dramatically.

The number shown on this page are for real. Do the math yourself with all the information provided in our showcase. Ask friends to double-check. This is not a gimmick - this is serious money were are talking about. Money that will allow you to make a comfortable living - from almost any place in the world. And if you look at the amount of the needed initial investment and compare the odds to create a substantial income from this small investment - it could be a mistake not to start your own business. The business you build also is a substantial assett and can be sold to others if needed. Web hosting businesses can currently be sold for up to 12 months of customer revenue.

Start your own web hosting business today.