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Quest to learn VPS Hosting Business
lovelyvulns
Member
From response gotten from earlier post and discussions on LET, it seems managing own or starting a vps hosting company is complicated and requires skill. While I have degree in comp science these things are not taught in schools.
In theory it should be easy to start a vps hosting company because it is based on dedicated server with virtualizations tools to share resources of an OS. Then domain and page for visitors, whcms and Softaculous license to put things on autopilot. Am using basic terms here so all can follow. But the real world it is complicated than that. You get to hear about RAID 0, 1, 10 etc, E5 cpus which is not like popular core i7 not excluding networking terms etc.
So save time, I would like get to learn about these things, how vps hosting works, when to oversell, kvm, openvz, how many vps go fit a server spec. (Aparently a $300 server of ovh can't hold 80 vps so where each would be sold for $5 so how do people get to sell $5 vps and make profit). I don't want to be another pump and dump vps hoster so please share ideas how you learn't and where to begin.
My last post can be found here: https://www.lowendtalk.com/discussion/153013/starting-own-vps-reseller-to-targetted-local-client#latest
Thanks all for your comment and support.
Comments
There is no master recipe to give to you. But no backups is a recipe for desaster. I recommend stick around this forum for 6 months and learn by reading along and perhaps you will learn one thing or another
U will learn nothing from me.
I can proudly guarantee dat.
Ignore useless shitposters like deank and you will learn a lot.
Indeed, it's very important to ignore people like me.
Do make a note though, those who are willing to help may have an ulterior motive. Be careful how they approach you. After all, LET is the ground for scams.
Expensive dedicated servers from places like ovh will not be profitable. You are correct. Honestly, you also have to weigh specs (and how many VPS it will hold), price, and how much you will charge. You will need to write a solid business plan.
If you are wanting to have control of the servers, rather than be a reseller, you'll need an upfront commitment. Nothing under a Dual E5 machine will be worth it. You'll never host enough VPS to even break even. You can find dual E5 servers, geared towards virtualization for ~$200/mo if you try hard enough. Make sure to give yourself adequate storage space and RAM. Minimum 2TB-4TB storage (MUST BE RAID-1, RAID-10 recommended) and minimum 64GB RAM. This will give you a server which you can profit off of.
These prices obviously don't include backup, web design, marketing, licensing for SolusVM/Virtualizor, WHMCS, etc.
It may take months or years to profit, however. It's a competitive market. One of the most competitive markets in the world. You need to be ready to spend thousands of your own hard earned cash before turning a profit.
This is why many hosts, which do not have much initial capital will start as resellers of other hosts' services, then start to migrate to their own infrastructure once they have an established client base.
I wonder what is the LTV (Life Time Value) of a server for a VPS hosting company. If one owns the hardware then how many months are typically required to recover the cost of the server? Something like 18 to 24 months will make it a very good investment.
Yes, if you have the capital to actually purchase the hardware, it will pay off MUCH quicker, with a much larger profit margin. It definitely requires dedication and commitment though. So, I'd only recommend that option if you are willing to see it through for the long haul. Can't really change your mind at that point.
Bah, a quick way to make dough.
Rinse and repeat. People fall for it every single time.
Setting up a server or managing is not the most difficult part, you can hire a $500-$1000/mo admin from India and he can manage the server but how are you going to get business ?
Here are are some basic questions that you need to answer or decide, there are many more but here are some of them that came to my mind right now:
1) Should you co-locate ? or just lease a server ?
2) What is your basic monthly cost? for how long can you pay for it even without any clients ?
3)How to cut down your recurring costs so that you provide cheaper services without compromising on quality ?
4) What if your server breaks down or crashes ? can you afford to keep a spare server (i'm talking about co-location)
5) Billing System selection
6) Marketing plan
7) Target Market
......... etc....
There are lots of things to consider, just managing a server is not enough
Should we be worried?
Asking on how to open up a company in a public forum might not be the
best idea. Make yourself a concept first. This reads like "I'd like to earn money
with IT but I don't actually know how"
@lovelyvulns
Well, at least you've come to accept that you can't just start selling and have profit.
Responding to your thread:
It is very easy to create virtual servers on a dedicated system. The problem isn't there.
You wish to run a business. A large component of a business is customer satisfaction and as a service-focused company, you must ensure your services (i.e virtual servers, web hosting, etc) are consistent, reliable and are offered at an appropriate price point. This is where things such as RAID, overselling, etc come into play. RAID 1 provides disk redundancy which, when your drives suffer from a failiure, will allow quickly get things back up and running. RAID 1 makes it fairly simple to rebuild your array.
Then, overselling. I'm no host, but the dedicated server you posted is nowhere near capable of hosting 80 virtual servers. It's not the RAM that's the issue; you lack sufficient CPU to provide processing time when your future clients require it. Such will cause slowdowns, which goes against customer satisfaction, thus affecting your business.
Then, once you gain sufficient capital to move on to colocation and your own peering setup, don't cheap out and single home your network. Doing so is undoubtedly stupid and will cause you grief should it go down.
I learned to manage my servers by making mistakes and rectifying them. For you to become a competent hoster, run a home server, play with different virtualization technologies, then find a job at an established company after gaining experience. It is possible to do otherwise, but in this way you'll gain the right knowledge and skills for the job.
I think an important point to mention is that if your going to resell from another host is that you don’t want to get a host that you think provides everything. You’ll find it’s much cheaper to license, setup and maintain your server if you’ve built it up yourself.
Lol you don't need to be worried
OP was trying to say he knows how to manage servers, but I'm trying to say just knowing a little bit of server management is not enough, you can easily get it done by paying some $$ but you need to know how manage it has a business