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Comment by mseebach | Hacker News Reader

What is your value proposition? Why should anyone give their money to you rather than say Dreamhost? Transparency? What would a beginner do with that? You'll write on your blog that their site was down for three days because a hard drive failed while you were on a beach somewhere, and, no, you can't afford automatic fail-over at $9/year, what did you expect? (devils advocate, of course -- but hosting is extremely competitive)

Anyway: what's your differentiator? Once that's clear, identifying clients and delivering that value to them is much easier.

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Thanks for the reply.

My target is to not oversell my systems, what most people fail to do most of the time. Offer spam protection at no extra cost, means less server administration for me and happier customers overall.

My differentiator is that whilst I offer very small hosting packages, aimed at the small business website I offer a package addon which means they can pickup their phone and just ask for something to be done, a page updated, email address created, sent a backup of their site etc etc (this is within reason). My aim is to take out the worry of maintaining a website for the new user, and allow them to focus on running their own business instead of fiddling around with a hosting control panel.

If you want to make your clients not worry, take over the entire process of being on the internet, not just hosting (there's a lot of worry in getting a website made). Get a network of freelancers and farm out the actual work, but you're the face of the work that the clients always talk to.

But there's a pitfall here: While you can make money on developing website, it's very hard to make money from value-added hosting. If you charge maybe $25/month, you can afford maybe 15 minutes of support a month, and you still face the risk of the client moving to some crappy host that only charges $5/month (80% savings!!) and they won't know what they're missing (you) until it's too late.

Either way, you're going to end up in the people business, not the hosting business -- and is that what you want?

these days its where the money is when it comes to hosting. Im ok with being in the people business that relates to hosting.

It is, indeed, very difficult. I co-founded a niche service that offered hosting and support for about a year -- until we succumbed to scaling problems. Just be VERY sure of your business model and cost of doing business beforehand.

If you do not oversell your systems, you HAVE to charge more than the average. It's simple mathematics.

Read the blogpost Dreamhost did on this, basically saying: yes, we oversell.

> My aim is to take out the worry of maintaining a website for the new user

Focus on your core. Let another company deal with the hosting part, (unprofitable, requires investment and 24x7 availability) and offer your services with, say, a 24h turnaround time.

You're not in the hosting business at all then. You're in the: Get people on the internet, the easy, cheap, and fast way. This part is a bigger differentiator. Just use someone else's hosting here.

Yeah I think you are exactly right. Whilst I have done my own server before this time I have a dedicated through another company. So starting my own "hosting company" may be taken different ways.

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