Hello.

I just bought a dedicated server costing $69.95 a month, including a cPanel license. I won't go into details of the specs, all that I will say is that they are pretty decent for the price.

Anyway, I was wondering if I'd made this step too soon.

I currently have a master reseller package (am waiting for the server to be setup, only bought it last night).

Basically I operate a web hosting company (I won't say the name because it's against the advertising rules of this forum). However it's relatively new and I only have around four customers. I got them within my first week, which was pretty good I think. Anyway, I spend $34.95 for the reseller package a month and am currently earning back only around $10-$15 a month.

Now I've just gone out and bought a dedicated server for $69.95 a month. Now obviously I won't be paying for both the reseller and the dedicated server but I am holding on to both for a while longer just in case the dedicated server doesn't work out as expected. I don't want to cause the customers any disruption to their service you see.

What I mean to say guys, is have I made the jump to dedicated server too soon. Have I made a financial mistake, so to speak? Thinking along the lines that I will need around 20-30 customers on my current prices to even meet the costs I'm spending. Raising the prices might make my service unpopular.

The reasons I bought a dedicated server were because I wanted full control over my service. I don't like other people managing my service.

What are your opinions? Should I have waited instead of just going out and buying it?

Well... you should have asked this BEFORE you've bought it ...
I hope you took into consideration that there is more to pay when going by this route (hosting on a dedi) than on a reseller account. cPanel/whm, aditional IPs, ssl cert, domain(s), whmcs licence etc; many of these are offered free on a reseller account.

Of course, if clients keep coming then all of these don't matter anymore and you will provide a better quality service.

Good luck with it.

Yes, you're right. I should have asked this BEFORE. Stupid me.
As for constant customers, I will try my best to please my current.
Maybe they'll spread the word if they like my service.
But yes, expenses have gone up quite considerably. And the server still isn't set up yet. It's been about 18-20 hours now.

As for WHMCS, I was rather considering The Hosting Tool.
I really can't afford the extra $15.95 a month for a license.
And yes, I did get that license free with the master reseller.

You have to make sure you can afford the dedicated server whether or not your clients are paying you, otherwise you're in trouble.

Like any business, with web hosting it takes money to make money. If you think you are going to start a hosting business and start out making money hand over fist, you're going to be out of business really quick.

Here the thing.

1. You should have asked if the pool is safe to jump in or not before really jumping in and realizing that it's full of sharks.
2. You should have considered the licensing and etc too before getting it.
3. What made you not think and just made an impulsive decision? You could have easily gotten a VPS before this.

After saying all that, here's the better or good part.

1. Since you have gotten a Dedicated Server, consider it a toy for you to use on your 1st month. At least now you can know how to handle a Dedicated Server a little bit.
2. Everything is not lost, you can always try to lease out your server as well, right? Maybe someone will take it off your hands?
3. Have you gotten the license for cPanel and etc? If not, you'd better get it quick before they tell you that the server is done and that you'd have to reformat it to install cPanel and etc. That time, you might find that you may need to pay extra for the reformatting.

At least you're not committed into a long term contract. Else you'd be in serious trouble.

There are a lot more better Reseller Plans out there. Paying $35 for a reseller plan, you could easily be getting a VPS + cPanel for that price. Geez... wow.

If you could still cancel the server, please try doing it. If not, then I'm sorry... there's not much that could be done now.

Thanks for all your advice guys.
Just to confirm I have received my dedi logins now.
And I am installing cPanel as we speak.

Unfortunately they don't offer refunds unless theres a physical fault. But I am not tied in to any contracts.

You are all right, I "jumped the gun" so to speak. And I might have difficulty affording it if I don't get some customers.

Of course I understand that I won't be successful right from the start. It will take a lot of effort from me, effort I am willing to put in.

I would, however, like aodat2 suggested, like to keep the dedicated server for a while. I'd like to explore life as a root user. I've never been in control of a server before.

But yes, the costs are an issue. I can technically afford a WHMCS license, but I won't allow myself to do so. I set myself a budget you see...one that I've already overspent I'm sorry to say. That's why I said I "cannot afford" WHMCS.

The server providers do have an affiliates system. Each customer I refer to them who buys a dedicated server from them using my link, I get $25. I might try my luck with that to see if I can earn myself some discounts.

But, I really would like to be able to keep the server. I like being in full control of my own service.
But I also must think responsibly. This cannot work just like that. Life isn't like that.

Have you any suggestions as to how I can make this work? Any way I can like rent out sections of the server without renting out too much? As I need a certain sector to run my own business when I eventually set it up. Ideally I would like to make this work and be able to keep the dedicated server. I'm 19 years old and eager to learn.

If you cant afford the server and a WHMCS licence, then you'll be out of business next week when you need to pay for a sysadmin to de-hack your box ....

I'd suggest *seriously* rethinking your monthly budget if moving towards a dedicated server - start by adding a zero on the end...

I'm beginning to regret this already.
Whatever happens I need to be in control of the server.
I am sick of reseller packages and being let down by the server provider.
(this is only the case because I have been let down twice already)
However, some of you are talking about VPS. Which would certainly be a much cheaper option.

I thought though that VPS had CPU limits. I read a few articles online and came to the conclusion that a VPS wasn't a good idea if you wanted to run a web hosting company. Is this true?

Because if a VPS would suit my needs then I'm seriously regretting the dedicated server. What do you think I should do? I currently pay $69.95 a month for a dedicated server which includes a cPanel license.
What kind of prices would I be looking at for a similar VPS?

TO OP

This is not a time to think what you did. As you already invested your money in dedicated server, then push yourself as hard as you can to get new customers. You should target local market, specially web design and development companies. Even, you can encourage those new entrepreneurs who don't have a website. You can also make a deal with web developers. Means you need something from them and they need something from you in return. It is just a straightforward business. Just try to increase new business contacts.

I would have waited personally - you don't know that you will be able to continue to grow at that same rate

Thanks for all your constructive criticism guys.
It has been most helpful. I will try my hardest to make this work.

I have just finished setting up ConfigServer firewall. My current security level rates at 114/133. That's not too bad for first time configuration. Considering that default setting only ranks at 78/133. I will be constantly seeking ways to enhance this security even more. Of course.

But yes, I will certainly be putting as much effort as I can into this project. Hopefully with enough determination this can work out. Thanks for the help guys.

If you can grow into it quickly then you've given yourself a good head start and won't have to migrate in the near future. Now that you have all the space and bandwidth you can use grow grow grow.

I intend to. I have just installed Softaculous and Fantastico Deluxe.
Am setting up a few other extras also.
I will put as much work into this project as possible.

What are you using as your selection criteria ?
I'm guessing based on your server choice that "impossibly cheap" is top of the list - in which case you're getting the service you're paying for

Depends on the VPS and the web host - saying a VPS isnt suitable for a web-host is a bit like saying a blue car isn't suitable for driving to work in - it'll depend on what car and where you work ...

I love your comparison. It is true but it is funny too.

Let's be serious for a while. You can not build a web hosting business without an investment or a decent budget. You need at least 1 server (for your first customers) and 1 VPS (for your own website and billing software). You should be able to pay hardware and licenses for at least 3 - 6 months, bid on some Adwords keywords, do some marketing, etc...in order to see your first customers. A shared web hosting business need a least some months to become profitable.