Frustrations with existing offerings
From our experience of existing shared hosting and virtual server solutions, we were fed up with offerings which claimed to provide backup and redundancy, that when called upon did not deliver. In 2007 a major co-location facility in London's docklands went offline because although they had not one, but two, backup generators, to cope with a power outage when a major electricity cable was cut, neither of their fuel tanks had any diesel!
The 'pile-it-high-and-sell-it-cheap' offerings also failed in other key areas, such as having bottlenecks at outgoing mail gateways. After an outage, outgoing mail would be unavailable for hours and perhaps days as although the shared hosts and virtual servers themselves came back online quickly, the bottleneck at the gateways of thousands of hosts trying to send queued mail caused these repeatedly to crash, creating the same effect as if the hosts themselves had been disabled.
All of the above limitations were even before considering that the "unlimited" offerings touted by the various hosting provideds all proved in the end to be very limited, at least if the cries of despair from the various hosting forums were to be believed.