What It Costs an Agency to Host Software for Clients
Published September 2, 2026 · Updated September 5, 2026
Open-source software is free to license, but hosting it for clients is not. The real costs are the machine each client’s app runs on (roughly $10 to $50 a month) and, far more expensively, your engineers’ time: provisioning, patching, backups, certificates and out-of-hours fixes, once per client, every month, forever. For most practices that is either a few hundred dollars of engineer time per client per month, or a flat platform fee, from $49/month per client on Kosnomos.
Here’s where the money actually goes, so you can price a client with real numbers instead of a guess.
The software: genuinely free
Whether it is file sharing, a helpdesk, a CMS or analytics, the open-source version costs nothing to license, no matter how many of your clients run it or how many seats each of them has. This part of the promise is real, and it is the whole reason the model beats reselling: there is no per-seat licence eating your margin. The catch, such as it is, lives in everything around the software.
The server: the small, visible cost
Each client app needs a computer that is always on and connected. Renting a small one costs $10 to $50 a month depending on storage and power. This is the number people have in mind when they say self-hosting is cheap, and at one client it genuinely is.
The engineer: the large, invisible cost
The server bill is not the real cost. The real cost is that, for every client, someone has to:
- Provision and configure. Install, connect the client’s domain, issue a certificate, set up access. Budget a day the first time and a couple of hours each time after, more if the client is unusual.
- Patch. Open-source projects publish fixes constantly, including security fixes that cannot wait for a maintenance window. An hour or two a month, per client, forever. The moment one client slips behind, you have fleet drift to chase.
- Back up. Set it up, pay for storage somewhere separate, and test a restore occasionally. Untested backups have a way of not existing when a client needs one.
- Answer at 2am. Disks fill, updates clash, instances go quietly offline on a Friday. Someone has to notice and drop what they are doing, and if you have promised a client a response time, that someone is on a rota you pay for.
Put honest numbers on it: even 3 to 5 hours a month per client of an engineer’s time is worth a few hundred dollars. At two clients that is absorbable. At ten it is most of a role you did not budget for, and it is the line item that never appears on the server invoice.
A managed platform moves that work rather than reducing your team: the patching, the backups, the certificates and the out-of-hours cover become somebody else’s standing job. How much of your own month that frees is a number only your practice can put a figure on, which is why Kosnomos publishes what it operates rather than an hours-saved claim about your technicians.
The alternative you’re actually competing with
Most practices weighing this are not choosing between self-hosting and nothing. They are choosing between hosting open source and reselling a closed SaaS product. Those price per seat, so your cost rises every time your client hires, which is the exact growth you were hired to enable, and your margin is whatever markup the vendor’s partner programme allows this year. (More on that trade in reselling SaaS vs hosting open source.)
The three options, with real numbers
For one client of about 25 staff running one everyday tool:
| Self-operated | Resold closed SaaS | Managed platform (Kosnomos) | |
|---|---|---|---|
| Software licence | Free | ~$15/seat/month | Free |
| Server | $10 to $50/month | n/a | Included in the price |
| Your engineers’ time | 3 to 5 hours/month | Low | Included |
| Realistic monthly cost to you | $150 to $400 in money and time | ~$375, rising with every hire | $179 flat (Medium) |
| Cost as the client grows | Flat | Grows per hire | Flat, always |
| Your margin as they grow | Flat | Squeezed | Widens |
| Whose problem is a bad Friday? | Yours | Theirs, slowly | Ours |
The two “as they grow” rows are the argument. A client who doubles their staff doubles what your service is worth to them; on a per-seat product that doubles your cost too, and on an instance it changes your cost by nothing.
What a fleet actually costs
On Kosnomos the price is based on the resources assigned to each client app: Small is $49/month for 1 vCPU, 2 GB RAM, and 40 GB storage; Medium is $179/month for 4 vCPUs, 8 GB RAM, and 160 GB storage; and Large is $469/month for 16 vCPUs, 32 GB RAM, and 640 GB storage.
Your bill is the sum, less your volume band: every instance drops 10% from 10 clients, 15% from 25 and 20% from 50. So ten clients on Medium is 10 × $179 = $1,790, less 10%, or $1,611/month, with no minimum, no platform fee and no per-client management charge on top. The band applies automatically; there is no tier to apply for. Nothing is priced per seat, ever. (How the sizes work · which size a client needs.)
A short list of add-ons is billed on top of the size price, per instance, and most partners buy none of them: extra storage beyond what the size includes ($10 per 100 GB per month), global delivery for a client whose people span continents ($50/month per instance, including 50 TB of traffic), a staging copy to rehearse a change on ($20/month per instance), an IPv4 address when a client’s bank or partner system insists on one ($20/month per instance), longer backup retention when a client’s regulator names a period ($15/month per instance for 90 days, $40 for a year), and a second-region copy when a tender scores disaster recovery ($40/month per instance). Ordinary support, isolation, backups, patching, monitoring, a client portal and 1 TB of traffic a month are included at every size.
Response times are not an add-on. Support from a real person by the next business day is included. If you write response times into your own client contracts, the partner program offers a four-business-hour initial response, a shared channel, and a named contact for $499/month for up to 10 active instances, then $25/month per additional instance. After-hours coverage is scoped and priced separately. Ordinary support costs nothing extra at any size, so Partner SLA is only worth buying if you are reselling a response time.
The short answer
If you employ infrastructure engineers with real spare capacity, hosting client software yourself is the cheapest option in cash and the most expensive in attention, and the attention cost compounds with every client you win. If you don’t, a managed platform is how you keep the part of open source you actually wanted (no seat licence, no vendor between you and your client, margin that widens as they grow) without staffing a hosting operation. That is what Kosnomos does: every client app on its own virtual machine, patched and backed up daily, priced by the machine and never per seat.