Most founders treat hosting as a solved problem. You pick the cheapest option that gets the product online, then move on to what actually matters: building the product and finding users. That logic is completely reasonable on day one. The problem is that it stops being reasonable faster than most people expect, and by the time you notice, the damage is already compounding.
Consider what happened to Robinhood in March 2020. Record market activity overwhelmed the platform, triggering a day-long outage that prevented users from trading during one of the most volatile periods in recent market history. The incident led to lawsuits, regulatory scrutiny, and significant reputational damage. The problem wasn’t the product itself. It was the infrastructure supporting it.
While few startups face Robinhood-scale traffic, the underlying pattern is common. Products gain traction, user activity becomes less predictable, and performance starts to degrade because the infrastructure underneath was never designed to handle sustained growth.
What ‘cheap hosting’ actually means for an early-stage startup
Cheap hosting isn’t a single thing. It covers shared hosting and entry-level VPS, and the distinction matters.
