Yes, I am a web host. Did I do everything right? No, by far not. I made many beginner mistakes. But I know what mistakes I made and how to do it better the next time. Knowing about the mistakes is one thing, but trying to avoid them will not apply to every situation for every web host. The following list shows a couple of mistakes that I made and also a few mistakes I have seen at other businesses. Recognize a mistake and learn from it. Your business and your customers will thank you for it.
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1) To make money, you will need to spend money
When I started my business I was under the impression, that if I would spend money only on the most necessary things, I could succeed. I bought the cheapest solution here and there. Quality was not always the key when making a business decision. Example: My first web hosting reseller account was chosen on price, not quality. I spend more time fixing the mistakes and lost time = lost money. Instead I could have saved hours of hard work and concerns by spending just a little more and get the necessary quality you need to start your business upon. It's like building a house - a solid foundation is necessary or your house will be blown away with the next storm. Fortunately I realized early enough what I was doing wrong and changed a few things to the better.
2) Friends - Do not depend on friends when starting a business
Do not depend on friends or their work when starting a business. Using friendship instead of spending capital on services might fire back at you. Yes, if friends really want to help, let them help. But it should be only in addition of everything else. You do not want to ruin your friendship with them over business issues. Also, make sure you reward them properly. Be honest if you can't pay them with money. Be honest upfront to them.
3) Marketing
Spend money on marketing. Do not try a zero $$$ spending marketing campaign. But do not spend money on just any sort of advertising. Do your research. Define your target group. Do not get discouraged if you do not see immediate results. Marketing is an art and it is something that requires patience and skills. And do your networking with friends, family and former coworkers. Use online communities to spread the word. But DO NOT SPAM. If you visit an online forum, be visible with content and knowledge. People will rather trust you, if you do not actively advertise your services, but if you use a signature with a link to your website or if you help somebody in a certain situation and they recommend you to others.
4) Business Plan
Be sure to have a business plan. Search the web or buy a book or software. Build a rock solid business plan and stick to it. Do not let a slow start discourage you to change the business plan right away. Starting a business is a slow process and requires time. Ask around or do research if you are unsure how to write a business plan.
5) SBA - Small Business Administration
Did you know that here in the USA you can actually get free business advise from professionals? The Small Business Administration supports startups and small businesses with advice and resources (including loans). Many former business owners or leaders offer their help to you free of charge. It would be stupid not spend a couple of hours at the local office and get some professional advise. Make an appointment early enough when starting a business.
6) Keep good records
Keeping good records of everything will help you running your business successful. Also, get a good organized filing system in place. Yeah, you will find the receipt for the new laptop in that shoebox - after searching for it for 20 minutes! An organized office will be your best friend when doing taxes and accounting.
7) Don't be greedy. Be patient. Re-Invest in your own business.
Starting a new business and having success is not something that comes over night. Work conservative with your numbers. Remember, not every cent that comes in is actual income. You have expenses, too. Make a budget and also keep track of your cash flow. Where does your money go when?! Don't pay yourself a high salary when you can't afford it. Don't buy a car and let it run as a business expense if you can't afford it. Re-Invest money into your own business. This will ad value and will reduce the need of loans, too. Get a financial advisor if necessary.
8) Don't just do what your competition does.
Don't just copy stuff from your competition. Be creative - create your own products and your own style. Otherwise you will always be a step behind your competition but first when shutting down business.
9) Learn Linux/Unix server administration
If you use Linux or UNIX as your server platform - start learning it NOW. Unless you are already experienced with these operating systems, you should at least get the basic understanding of how to administer and to protect your server. Remember, the server is the foundation of your business.
10) Do not offer unlimited.
Do not offer unlimited bandwidth or unlimited disk space. These offers will just attract the wrong kind of clients for your business. Have you ever seen an unlimited hard drive when shopping for hardware? If you find one, let me know. There is no such thing like unlimited bandwidth either. Even if you state your terms of service properly, unlimited bandwidth is bad for a web host.
