Do you have a dream to start a web hosting company? A lack of clear ideas, however, pulls you back. There might be several pieces of advice available here and there about starting a web hosting company.
So, you get confused about where to start. To succeed in the web hosting business, you need two things – a step-by-step approach and a SWOT analysis of your web hosting business.
In this article, get a better idea about all of it. Let’s get started.
Is there a demand for web hosting service?
Yes, the web hosting business has high in demand. Even though pandemic distorted local businesses, online businesses are going in an upward trend—this why many companies try to build their online presence. If a business wants to elevate its brand, it should have a website and social media profile.
Google trend shows web hosting trends in United States, India and the United Kingdom.
Can you make money by starting a web hosting company?
The short answer is yes. There is high demand and opportunities, but there are also few risks. Like other business, your success depends on your efforts, how hard you work and take your business seriously.
What is your initial investment to build a web hosting service?
You can start with $100 as an initial investment. However, it depends on your business goal. To set up a web hosting service, you need to spend money on three things.
- Domain Name – it costs $12 Per year
- Web template – $60 Life-time
- Reseller Hosting – $20 per month
However, if your business goal is more prominent, you have to invest significant money.
How To Start a Web Hosting Company, Follow the Steps
To start a web hosting company, you need to follow the steps given below without fail.
Step #1: Finding Your Niche
These days market bustles with the web hosting providers. So, the competition is tough. And in the beginning, you can’t even imagine competing with the big names of the industry.
All you can do is target a specific local niche market such as construction, green energy, homemade jewellery, DDoS-protected servers, or webcomics.
Then, offer a unique value to distinguish yourself from others. This can be a high-quality server, a competitive pricing plan, or extra services like web design.
Finding your niche before starting a web hosting business will definitely give you an upper hand against your competitors.
Step #2: Your Target Audience
Since you’re offering hosting service, target audiences would be web designers, entrepreneurs, startups, individuals, SME owners, or bloggers.
Without knowing whom to sell your services, you can’t move forward. Hence, deciding upon a target audience is crucial.
For example: If you live in Chennai, Mumbai or Kolkatta, you can find local customers. Many small businesses don’t have a website and don’t know how to run them.
This is an excellent opportunity to earn more money as your offering package plans like web hosting plus building or managing a website.
A coherent knowledge of the target audience will not only help attract the people but will assist you in bringing more traffic to your website also.
Step #3: Research Competitors
Next, research competitors’ business models.
You definitely want to separate yourself from other web hosting companies. Ideally, you want to have zero competition within your niche.
However, that might not be possible. Researching about your web hosting competitors will give you advantages when identifying marketing techniques, providing services, and looking for clients.
Gather as much data as possible to reach a reputable position in the web hosting business.
Step #4: Define Your Brand of Web Hosting
Your brand name is the identity of your business. There are several companies with different names.
Your business name shouldn’t sound similar to any other web hosting services. Remember that your web hosting business identity should be unique, innovative, and relevant to your niche or expertise.
Do deep research before selecting a brand name.
Step #5: Choose a Suitable Server Partner
Choosing the right server partner will be critical to the success of your web hosting business. Clients don’t want their content to be migrated if you choose the wrong data center.
Look for a server partner that offers:
- Great value for money
- 24×7 dedicated support
- Premium network
- Fast server deployment
- Protection from DDoS attacks
- Hardware like SSD and RAID-10
Choose a server from these standard server types like Dedicated Server, VPS, and Cloud Server.
To run a web hosting business with a small operating cost, you should buy good reseller hosting from a reliable provider. These are some of the big names in the market of reseller hosting.
- InMotion
- HostGator
- Liquid Web
- A2 Hosting
- GreenGeeks
Step #6: Setup Your Business with – Website, Support, Billing System
So now you know your server partner. Next, you need a website.
cPanel/WHM is the most commonly used website hosting control panel. And it integrates with CloudLinux very easily to isolate customers.
WHMCS is widely recognized as a management tool and client billing system. It has an in-built customer support desk as well.
Many web hosting companies opt for external help desk software like Zendesk or Kayako.
Step #7: Find Web Hosting Clients
Once your systems are in sync, you can start finding clients. Start spreading the word with your friends and networks.
You can go out and contact small business in your local area. If you have minimal capital, willing to grow your business, you need to put in the hard work up front.
However, do you have a budget to get customers through advertisements?
Then go about it with:
- Facebook ads
- Google AdWords
- Local newspaper ads
- Ads on relevant magazines
- Banner advertisements on your niche market websites
SWOT Analysis to Start a Web Hosting Company in India
SWOT analysis can immensely help boost up your future web hosting business. This technique is quite popular among web host startups.
It’s a well-structured planning method to evaluate how user-friendly your website is.
The method is based on two internal factors such as strengths and weaknesses and two external factors like opportunities and threats.
Internal factors mean that you can control these factors, employee or money by yourself.
You can’t control external factors like government in your local municipal or central, market and more.
Now, let’s see these factors more in-depth.
Strengths
- Easy to set up
Setting up a web hosting company is easy.
All you need to do is to keep your clients happy by providing the best solutions for their business needs.
Once it runs, most of the websites will run without much expertise or effort.
- Minimal capital needed.
You can start with low capital. So, this is a great additional source of income
Starting a web hosting business is a great source of additional bucks.
Are you worried about balancing your hosting business with the day job?
Don’t worry.
Just take care of the initial client registering and you’re ready to see your bank account grow.
Weaknesses
● Issues not in control
DNS records that connect the domain with hosting are controlled by a third party.
As DNS servers drop, your clients’ websites stop working.
When this happens you might not want to tell the clients that it’s out of your hands.
● Stressful work
As per some of the established web hosts, the web hosting business is often incredibly stressful.
It happens particularly when you don’t know how to fix an issue.
You might have to be on-call 24×7 to provide uninterrupted support.
If you can’t manage to provide a good level of customer satisfaction, your clients may choose other web hosts.
Opportunities
- You can hire a professional quickly.
In India, you can hire an employee to do tasks if any server issues go out of your control. You can also use freelance website to find a developer for your company.
● Continuous growth and expansion
Web hosting business is a doorway of opportunities.
You learn so much on the go while your company advances towards growth and expansion.
Fortunately, web hosting requires minimal investment and has a bright business prospect.
● Discover newer markets
Through your web hosting business, you come in contact with an altogether different audience.
You get valuable business insights.
This will ultimately pave your way to brand new ideas and innovations.
Threats
- Competition
The biggest threat is big name in the hosting industry like Godaddy.in, Bluehost.in, Hostgator.in, and the list goes on starts Indian based business. AS a small business, you have to compete with these tech giants.
● Hosting illegal content
You should very well go through all the nitty-gritty of your hosting website content.
There should not be something that’s legally non-acceptable.
Any pirated content, slanderous message board postings, Intellectual Property Infringement, etc might put you in big trouble.
● Lack of clarity in policies
Your client might not be willing to do business with you if you don’t have a transparent T&C.
Through T&C most of the risks are tackled.
Technical stuff and business viability need to be well taken care of.
Final Words
As a web host provider, you’ll assume a good amount of liabilities and risks, for example, preventing your client’s site from malicious attacks, server issues, breach of contract, and so on.
So, it’s advised to contact special lines of insurance that are available particularly for such things.
Even your clients would insist on having insurance.
Before you jump start into a web hosting company make sure to fulfill all of the above things.
Read also:
The best free web hosting for small business website
How Much Does a Domain Name Cost
How to Choose Hosting for WordPress Website