How to Make Money Through Web Hosting Without Being a Web Host

I realize that not everyone that reads this blog is a web developer, but it should still be interesting to read just in case this method works for your particular niche!

I get asked a lot about my web development business by people who want to do the same.  One of the questions that often comes up is how I go about charging my customers for web hosting?  Well, I don't.  In fact, the last thing I would ever, ever, ever want to do again is try to make money hosting my client's website.  However,  I do still make money through web hosting.  How's that you ask?  Well… here's how.

Shared hosting is not very lucrative for web designers

I was so excited when I got my first few web clients.  Not only did I not have to work on-site for a company, I was able to do something fun!  I also had the opportunity to make annual recurring income by subletting the hosting that I used out to my clients.   That's right, a whopping $90 extra a year baby!  Or so I thought…

It didn't take long to see that trying to be a web host was a big mistake.  The site would go down, I was called to fix it.  Customers wanted a backup of their site, I had to go and do it for them.  Things broke, I was the one who had to fix them.

It sucked…

The time value of money

Now, at the time of writing this post – my consulting rate per hour is $150 and my development rate is $80.  Hopefully you can see where I am going…

Why would I want to spend 3 hours trying to find out why a server is down when the hosting company could be doing it?  Sure, I could charge my client but that'd be unethical in my mind since they'd get that service included in a normal hosting plan.

The price of having someone host with me and the hours spent helping them with things I really have no control over doesn't add up.

How I don't host and still make money with hosting

Rather than hosting a site in order to generate revenue – become an affiliate.  Nearly all hosts have an affiliate system set up and it's a great way to create a little side income as a bi-product of what you already are going to do anyway.

Here's my process:

  • The client signs with me to create a site.
  • My team goes to work on the design.
  • If they don't have hosting: Before the deployment phase (when they are going to get their site) I send them an email letting them know that they need to set up their hosting.  In the email I give them an affiliate link to Bluehost (and let them know it's an affiliate link and would really help me out if they used the link.  <– Just like this one, ha!).  They love me so they click-through the link, and then I get an extra $90 (you have to use Commission Junction for this rate).
  • If they have hosting, but it's crap (99% of the time they have Godaddy): I let them know that I recommend Bluehost since their customer service is amazing and their overall hosting is great.  I send them the link.  If they agree, I get $90.

Either way they will be spending the same amount of money on hosting.  Plus, this way they get taken care by an awesome shared hosting company and you don't have to do the support.

So now, armed with this knowledge go forth and make some extra money and spend the time you'd be spending on support on more important things like sales.  (Not that customer service isn't important.  It just isn't important when you don't need to be the one providing it).

Have any cool tips like this for other small business tasks?  Let me know in the comments!