If you’ve been around the lowend scene long enough, you’ve probably heard of a company named Virmach.

They were known for having killer deals around the holidays, particularly Black Friday.

Their recipe for success was simple:

1. Rent cheap servers from their vendors, primarily ColoCrossing.
2. Race to the bottom (offer attractive value at very low cost).
3. Advertise on LowEndTalk.

This isn’t an over simplification, either.

There were posts back in 2019 asking if ColoCrossing in fact owned Virmach — because that’s how synonymous they became.

It actually got them very, very far too.

That is until they decided they were going to purchase their own equipment, and colocate it throughout the world in various datacenters…

Cracks Tend To Appear Overtime

At first the idea of Virmach leaving ColoCrossing was essentially celebrated. For one, they would gain IPv6. For two, they were leaving the big bad wolf ColoCrossing… and last, but not least:

It was new and exciting, so people hopped on the bandwagon.

A ton of people preordered these servers, and Virmach eventually created a thread announcing these brand new owned Ryzen servers.

It was more or less from this point forward Virmach would begin their decline (which is still actively occurring; there’s no R.I.P. yet.)

Customers would complain about delays, issues with delivered servers, IPs suddenly changing and more, which wasn’t an issue at first.

It just seemed like growing pains and Virmach always seemed to have a good reason why something was happening and when it would be fixed… but it was clear cracks were beginning to form.

You Can’t Have Sales All the Time

(They have this on their website as if its current, but it has their old logo and the file is titled “2019”)

One of biggest issues Virmach had is they had way, way too many sales. It had gotten to the point if Virmach wasn’t charging $3.87 per year for a 1GB ram VPS people weren’t even interested anymore.

That’s not profitable.

Sales are great and all…but they need to be done in moderation and can’t be your sole source of survival. Especially long term contracts.

I think Virmach simply bit off too much.  They oversold their servers to the extent they couldn’t even hire people to do support for those customers and still have a profit margin.

Then they threw another wrench into things by deciding they wanted to leave ColoCrossing and own all of their own equipment.  And the solution for that?

Create another sale.

There’s a Lot Happening All at the Same Time

Around July, 2022, whoever manages the Virmach account on LowEndTalk said:

I’ve had to work every day, all day, for the past year or so as a result of the situation we’re in right now. So the number of hours spent are heavily skewed in my direction right now. We have two others working with us right now. We’re still a small company and always have been, but especially more recently.

Around the beginning of COVID we had our billing person leave, our hardware guy leave, and two sys admins leave.

It’s been OK until we also had to do a massive quantity of builds, deal with aging hardware, as well as migrations simultaneously over the last half a year plus. It probably also didn’t help that I made some badly timed sales and we had way more problems than anticipated with said new hardware. But yes, you are speaking with one single person right now who has been handling almost everything and not sleeping over a very long period of time especially since it’s the weekend and no one else is working today.

A perfect storm.

You’ve sold too much product to deliver, you’ve decided to move all of your clients and invest a large amount of money in doing that, and now all of your staff quits? Even if you intended to deliver on earlier promises it’s going to be hard to do that now.

I think right around summer 2022 was truly the peak of Virmach.  (See also: Virmach Teeters on the Edge, published in August 2022).

After that? People simply just started losing hope. It seemed to have turn into a one man show. If an issue came up? Good luck getting a response. People had tickets open longer than 90 days, for example. I still literally have a ticket open right now older than a year.

That month of July in the summer of 2022 was also the last time the Virmach account ever logged into LowEndTalk, the primary source of business for them.

They remained active at other forums, but as time went on have became more and more reclusive.

Any new Virmach thread is usually people talking about the downtime of the products they paid for, with Virmach responding how everything is down at all of their datacenters for X reason and then not responding for another two months.

Technically, It’s Still a Story Being Written… but Is It Really?

It’s been an entire year of empty promises, downtime, and lack of solutions.

While I still think it’s entirely possible to turn the entire company around, change needs to happen… urgently. A year is a very long time to still be in the same position.

You can only be mediocre for so long AND provide poor customer service, eventually, customers will find other solutions. When your central selling point remains locked to pricing, you don’t have too many unique selling point that’ll keep customers around when another guy comes on the block that price matches you…. and provides an equal if not better experience.

(You’re at a great place to find a better experience for cheaper, by the way.)

Anyways, like I said earlier….

They aren’t dead yet. A faint pulse, but a pulse nonetheless. It’s up to Virmach to determine if they want to grow or continue the decline. There’s a market for dev boxes for $3.87 triennially with a 33% uptime SLA if all else fails.

To think if they only stayed with ColoCrossing to begin with…. we would all have our cheap Buffalo servers and Virmach black friday deals.

Appreciate the simple times.

Epilogue: What Do We Wish for Virmach?

When we published a piece last year highlighting some of Virmach’s issues, the reaction was predominantly “yeah, I’m having problems too”.  But there was also some “you shouldn’t criticize them / this is a hit piece / why are you wishing them bad” commentary.

Nothing could be further from the truth.  We love providers who bring awesome deals to our community, and for a long time Virmach did just that.  They tried to compensate for their razor-thin margins by putting some guard rails around support, but fundamentally there just wasn’t enough revenue coming in.  It doesn’t take too many chargebacks or unexpected hardware expenses or network overruns before tiny margins are swamped.

If Virmach regains stability and customers are happy with the service they’re getting, we’d love to feature them again.  Providers pushing the bounds of what’s possible in cheap hosting is what we’re all about!

So we sincerely wish Virmach the best and hope they recover.  Until then, we’ll keep an eye on developments.

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Sir Foxy

I write things sometimes. Contact: hey@sirfoxy.com

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