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← Advanced money · Mission 1 of 10

Run your own mini data centre: rent rack space, sell servers

Agencies, accountants and IT firms pay someone to keep their servers running, usually a giant cloud they never speak to. Put your own refurbished server in a UK data centre, split it into virtual servers with Proxmox, and sell UK-hosted servers and offsite backup to businesses near you. Budget around £1,800 for hardware and £50 to £200 a month for rack space before the first client pays.

240 minAdvancedTools: Hardware around £1,800, colocation from around £50 to £200 a month, software freeStep 1 free
A one-server business modela calculator that shows break-even, profit per hour and what each price change does
A real server in a real data centrerefurbished 1U, Proxmox VE 9, ZFS mirrors, locked behind a VPN
Products you can sellcloud-init VPS templates, managed servers and Proxmox Backup Server storage
  • The boring bits that keep you in business: terms outline, SLA credits, abuse runbook and monitoring
  • A kit: parts list, colo quote checklist, setup script, outreach messages, pricing table and a 30-day plan
Before you start
  • Comfortable on a Linux command line and with SSH. Start with Terminal survival kit and Harden a server if not
  • Around £1,800 for a refurbished 1U server, SSDs and spares, plus a colo contract from around £50 a month
  • A home or office to burn the server in for a few days (it's loud: think hairdryer, not laptop)
  • 8 to 12 hours a week while you build, then a few hours a week plus being reachable for outages
01/09The business: what you sell and who buys it0 done
STEP 01 of 09~20 min

The business: what you sell and who buys it

Pick one offer and one kind of customer before you spend a penny on hardware.

  1. You're not competing with AmazonYou can't beat the big clouds on price per GB of RAM, and the European budget hosts sell a 4GB virtual server for a few euros a month. Hetzner, the best known, runs its cloud from Germany, Finland, Singapore and the USA (hetzner.com ↗), not the UK. What small UK businesses actually buy from a small host is different: a UK location, a named human, backups that work, and someone who fixes it for them.

  2. The three products that work for one person with one server:

    • Managed servers for agencies. Web and digital agencies host dozens of client sites and hate being on call. You give them a VPS (or a few) that you patch, back up and watch. Priced on your hours, not on RAM, typically from £90 a month per server. This is where the margin is.
    • Offsite backup storage for IT support firms. Small IT support companies (MSPs) need a second copy of their clients' backups outside the building. You run Proxmox Backup Server and rent space per TB. Low support load, sticky customers.
    • Plain UK VPS. Self-service virtual servers. Good for filling spare capacity and for developers who want a UK IP, but price-sensitive. Treat it as the filler, not the business.

  3. How it fits togetherYou buy a refurbished server, rent a slot in a data centre rack (that's colocation: you own the box, they provide space, power, cooling and internet), install Proxmox VE (the free, open-source virtualisation platform), and carve the server into virtual machines that you sell by the month.

    Careful
    • What it takes. Capital: around £1,800 for the server, SSDs and spares, plus colo from around £50 a month for 1U and more for extra power and IPs.
    • Skills: Linux, networking basics (subnets, gateways, firewalls), ZFS, SSH and a calm head.
    • Hours: 30 to 40 hours to build and launch, then a few hours a week, plus being reachable when something breaks.
    • Insurance: professional indemnity and cyber cover before your first paying customer.
    • Time to first customer: expect a few weeks of outreach before the first pilot converts.
    • Who this suits: someone who enjoys infrastructure, already has a few agency or small-business contacts, and likes the idea of recurring monthly revenue that grows one customer at a time.

  4. Everything you'll use is in one kitDownload the kit, or open kit.md to see each file.

✓
CheckpointYou've written down your main product (managed servers, backup storage or VPS), your first customer type, and ten businesses within an hour of you that fit it.
If it breaksWhy not just resell a big cloud? + 1 more
Why not just resell a big cloud?
You can, and some people do, but you then sit on the cloud's prices and margins with no control over the hardware. Owning the server is what makes a £90 managed plan profitable on hardware that costs about £50 a month to own.
Can I run it from home instead of a data centre?
Not for paying customers. Home broadband has no SLA, residential IPs are blocked by many mail servers, and a power cut or a router reboot takes every customer down. Build and test at home, sell from the data centre.
Still stuck? Ask the community
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