The problem I fear stems from the fact that people turn to hosting, or starting a business in general, when nothing else is available to them, and they're in some of the worst financial situations. No job, $1000 in their account, and ready to have a business. Essentially, they have no money and not enough time. They need to become seriously profitable within weeks.

Personally, I don't think one needs $20000 in cash to be a host, but one probably does need $20000 worth of time on his hands to make it work.

We do need a definition for "host". A reseller account, or one dedicated server, virtually not advertising budget, is what many hosts started out with, yet they have survived, and even made a name for themselves. The right person can still do it, or so I hope.