VPS Hosting Market to Hit $19B by 2030, Driven by SMB Growth and Performance Needs

A new report by Research and Markets shows that the global VPS hosting market is projected to reach $19 billion by 2030, which is more than double its current value. That reflects a steady 15% CAGR, driven by SMBs, agencies, and dev teams seeking better performance and control than shared hosting can offer without the overhead of running their own infrastructure.

VPS is a mid-tier sweet spot, suggesting the days of shared hosting may very well be at death’s doorstep. For hosts, it’s a prime time to consider upselling, bundling, and offering tailored services for those who need it most, especially in eCommerce. And with cloud prices rising, it may be the perfect time to snag performance- and budget-focused users.

VPS now represents the new entry point for professional-grade hosting. It’s one outcome of the broader trend toward personalized hosting experiences, according to Kamatera’s CEO, Tal Holtzer.

“We’re seeing a fundamental shift where businesses and developers are moving away from one-size-fits-all solutions toward highly customized, self-managed environments,” said Holtzer.

Most are familiar with the 2024 SMB spike and the heavy verticals-wide shift to digital-first operations. By March 2025, VPS search inquiries began to increase week over week, which was a surge not seen since late 2023.

Managed VPS solutions, in particular, are gaining traction, especially as providers bundle tools into budget-friendly plans, showing that VPS hosting is not only for the experienced, but is an entry point for newbies, too.

Hristo Rusev, CEO and Co-Founder of ScalaHosting, attributes this growth to SMBs who want greater control, security, and scalability.

“We’re also observing a rise in global demand for managed cloud VPS solutions, as businesses look for robust infrastructure without the burden of in-house server management,” Rusev said.

For SMBs, influencers/Gen Z entrepreneurs, and tech startups, slow load times mean lost conversions, so shared hosting is something they won’t dare to try.

Instead, they’re going to the next level of sheer independence and performance, suggested Brooke Oates, Product Manager at Liquid Web.

“While entry-level VPS continue to remain popular for self-managed administrators, we’re seeing growth on the upper end of our VPS products as these businesses continue their success and need that vertical scalability,” said Oates.

The migration to VPS hosting has long been compared to moving out of a shared bedroom. It costs more, but with it comes more space, more freedom, and peace of mind.

In fact, a 2025 report from Liquid Web found that 88% of hyper-growth businesses (HGBs) improved speed, uptime, and revenue after upgrading from shared hosting. Of those surveyed, 40% moved to cloud VPS and 27% to managed VPS, with nearly half citing VPS as essential for long-term stability.

But the shift to VPS hosting isn’t happening in a vacuum. Recent tariffs, the explosion of AI tools, and the proliferation of regional data centers have reshaped the infrastructure landscape.

It also accidentally reshaped the cost-benefit analysis for SMBs, especially as 33.3 million small businesses now operate in the U.S. alone, with similar growth patterns across Asia-Pacific, Sub-Saharan Africa, and Latin America.

Beyond infrastructure, many users are turning to VPS hosting to support automated workflows, like n8n. Rusev noted that’s one of the most common requests ScalaHosting has been getting lately for its VPS hosting.

n8n is an open-source automation platform that lets users connect services and streamline everything from chatbot replies to customer support platforms to syncing social media updates.

Personal use is also skyrocketing — one Reddit user said they use n8n for meal planning: “We have a Google Sheet with about 70 recipes that we love,” u/studioafraz wrote. “[M]y and my wife’s Google Calendars to suggest only recipes that don’t clash with our schedules. Bonus: If we have a lot of appointments on a single day, we only get recipes with short preparation times.”

The tool saw a 100% spike in Google search interest in February 2025, especially in the Washington, D.C., area, suggesting interest among government agencies or compliance-heavy industries.

n8n thrives in VPS environments thanks to the flexibility required for automation-heavy tasks — think AI-generated reports to customer support bots and backend shortcuts. For dev-focused teams and SMBs automating their workflows, tools like n8n are a perfect match for VPS.

A major industrywide shift to VPS is well underway, and hosting providers are investing in the features and support to obtain and keep those users coming back.

“[Kamatera’s] invested heavily in expanding our knowledge base and documentation. We provide the tools and the know-how, so our clients can build without limits,” said Holtzer. “Of course, our 24/7 support team is always online for 3 AM ‘I accidentally deleted everything’ moments.”

ScalaHosting has a similar mindset, said Rusev: “Looking ahead, we’re working on smarter AI-powered tools, faster edge VPS hosting, and making high-quality hosting more accessible to small and mid-sized businesses around the world.”

While shared hosting may still serve hobbyists and blogs, VPS is becoming the go-to for creators, founders, and teams who are serious about launching fast-growth businesses.

Hosts who want to get in on this movement should be thinking bigger: Bundling smart tools for newcomers while promoting autonomy for agencies and devs is a slippery slope, but it’s one worth finding a balance for — especially among fast-growing verticals, including eCommerce, indie games, and dev sandboxes.