How To NOT Start A Start-up

I saw this video the other day while searching for some information and I was absolutely in shock! While I have to say it's pretty cool to have that in your garage, and I myself have some older servers that I use to mess around with, this is the wrong way to start your start-up's data center.

I can't think of a single reason why anyone would do that. Some of the servers look like P3's and P4's. There might be some very old Xeons in there. Looks like they were picked up used. If you're thinking of doing something similar don't. In the rest of the post I'll go over the details on why with a better alternative.

Maintaining Older Hardware

First, while a lot of software is backwards compatible, especially Linux which is what I think they are using, you sometimes run into compatibility problems. In addition, you have to worry about getting replacement parts if something on the server dies. While hard drives and memory may be easy to get, things like case fans, and CMOS batteries aren't. Finding a replacement CMOS battery might wind up costing about 25-50% of what they bought a server for.


I did a quick look on eBay for some of the computers they are using. Between everything including the server cabinets, servers, desktops, switches, router, drives, cables, accessories, we're probably talking $2,500-$3,000 easy. For that price you can get a brand new server from one of the major server vendors or build one yourself. It would probably even perform better.

Power is another issue. Electricity isn't free and if they're planning on running the data center in their garage, like they said, then they have to power the servers 24/7/365. Even at idle, a typical computer can draw 60W of power. That's just a regular PC, not a server with extra fans, and multiple drives, but lets use that 60W as a baseline. Now lets check Energy Australia's Energy Calculator. I'm pretty sure he's in Australia. So, 20 machines, 60W each running 168 hours a week comes out to $1464.50 a year, or $122/month.

That's a good chunk of change to power such old hardware. That doesn't even factor in the cost of air conditioning in the summer!

Let's compare that to this Compaq Proliant DL380 G5 Server. Click on the picture on the right for more details. Maxed out with 2 Quad Core CPU's all 8 Memory banks loaded as well as 8 SAS drives filling all the bays, it's only at around 400W at 100% utilization! That's less than $500/year ($41/mo) in electricity. About 1/3 what the dinosaur data center will cost. Since he seems to be a hands on person, he could have even go the build your own rack server route.

The server with 1 Quad Core no memory or drives, goes for just over $2k as of today. 1CPU, $200-300 for memory and some drives to get started and that would have been a better use of that money spent on eBay.

Time is Money

From what I could figure out, it's been over 8 months since he started and it doesn't look like the project went live. There's no mention of it in the blog anyway. The last entry was over a month ago.

Internet Connectivity

In one of the videos he mentions getting a "big pipe" to connect the servers to the Internet. That's not cheap. Even a single T1 is about $300/month and these days, a T1 (1.5Mb/s) is not considered a big pipe.

Websites also don't become successful overnight. You can start small and probably the best thing this person should have done, if they couldn't use a shared hosting account, is get a dedicated server. That way they wouldn't pay any up-front hardware costs, have to worry about maintaining hardware and would have their server in a real data center with multiple redundant Internet connections and they could easily increase their bandwidth as usage increased.

As of today, you can find dedicated server hosting from a number of different reputable companies with prices starting as low as $79.00 a month and bandwidth of 500GB-4000GB. For reference, a T1 line sending out data all day long for a month can only handle around 350GB of data. With a dedicated server, you get a burstable connection. So if you have a big spike, your network connection can handle it. Usually up to 10Mb/s but in some case you can get up to 100Mb/s or more.

Affordable Dedicated Hosting

Here are a few links with prices (as of today) for some popular and affordable dedicated server packages.
Provider CPU Memory Disk Bandwidth Price/mo
LunarPages Celeron - 2 Dual Core Xeons 1GB - 4GB 80GB - 4x400GB SATA or 4x146GB SCSI 1000GB - 4000GB $79.00 - $800
IPOWERWEB Celeron 3.06GHz 512MB - 1024MB 80GB - 250GB SATA 500GB - 1500GB $129.00 - $169.00
GoDaddy Celeron - Quad Core 2.83GHz 1GB - 4GB 120GB - 2x300GB SATA 500GB - 2000GB $79.99 - $419.91
Host Gator Pentium 4 2.4Ghz - Quad Core 3210 Xeon 1GB - 4GB 80GB - 4x400GB SATA or 4x146GB SCSI 1500GB - 2500GB $174.00 - $374
Pronet Hosting Intel Core 2 Duo 3.06GHz 2GB 2x160GB SATA 2000GB $99.95

If he wanted to use his own hardware he could have also bought a beefy server, used some sort of virtualization technology such as Zen, VMWare or Solaris Containers (Zones my personal favorite) and added hardware and shifted around virtual servers as necessary. Once he had his website built, he would then ship the server out to a good colocation facility which would probably run around $100/mo.

This all looks like a lot of fun, but in the end they probably delayed the launch of their product and spent more money than if they bought one new, powerful server or got a dedicated server or VPS to start.
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Anonymous said...

Hi its a great article with lots of valid points, though im sorry that i never actually posted anything on my blog as to why i did the things i did. Please read my responses to your article.

garagedc guy ...

Anonymous said...


Mausio said...

The garagedc guy is in my eye's doing a great and NICE job there, and why dont say the good,fun,learning facts about make this all at home?

It inspire's me to host more @ home :D thnx garagedc

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