There’s also other income potential when you offer related services like domain registration and web designing/consulting services. There are many domain registrars that offer an affiliate program and you can partner with a local web design team for referrals.

It does require some technical know how and research, but there’s good income potential. Some hosts also provide technical support for you for a small fee.
Its easier when you use a good control panel like Plesk that allows your clients to self-manage their FTP, email and databases.

You’ll be surprised at the number of websites that don’t require the full capacity of a dedicated server, but just need a simple hosting solution.

Here’s a quick checklist on some of the things you should be looking into.

1. A website. Get a good domain and design a simple site. Be focused on the kind of service that you offer – keep it simple and attractive. I like hosting sites that have few preset packages. Orders come through this site and you can link it to Paypal or some other payment gateway.
2. A good VPS host provider. As you know, we highly recommend ServInt as our favorite VPS host. They’re reputable and reliable, and you have a choice of 2 locations in the US.
3. A good invoicing system. We love Freshbooks. It’ll generate invoices based on your recurring schedule, you can bill monthly, bi-annually or yearly.
4. A good helpdesk system. Kayako and Cerberus are some popular choices. This’ll allow you to manage support requests efficiently. You can even hire off-shore staff from places like ODesk, Scriptlance and Elance.
5. Education – especially on Linux (basic commands, software, etc). Hanging out at forums like Web Hosting Geeks and Web Hosting Talk can be very educational too.
6. A web services partner like GoDaddy that you can get domains and SSL certs from.
7. Get the word out! Use Adwords, forums, social networks, etc to promote it. Consider giving some free hosting space to charities and non-profits in exchange for a link. That’ll help your Search Engine Optimization too.
8. Here’s a good e-book that’ll give you more information – “How To Start A Successful Hosting Company“

Any other tips or experiences you’d like to share?

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Setting Up Your Own Web Hosting Company