What is server colocation? Can I make my own data center?
Colocation is a hosting option for small businesses who want the features of a large IT department without the costs. Colocation allows you to place your server machine in someone else's rack and share their bandwidth as your own.
Of course you can setup your own data center and offer colocation service for others. But they will expect a certain level and quality of service.
For example you'll need enough bandwidth (50-100Mbit minimum for a small data center). You'll also need another independent line as failover (at least 1/2 of the primary bandwidth) plus a strategy how your customers servers will continue to be accessible. Will the public IP's be rerouted via the backup line or do they need secondary DNS entires?
Redundant power supply for all devices is a must have – be it via multiple kVA UPS or a generator. Your customers will expect it to last at least a few ours so they have time to properly shut down their servers.
Proper cooling and fire resistance of the server room since any damage because of heat or fire will be on you.
You will need a properly setup network to provide and or limit the bandwidth for customers (switches, routers,).
These are just a few points that come to mind spontaneously.
Server Co-location : Above link given is great info, besides you can also refer to http://www.wisegeek.org/what-is-server-colocation.htm
How to make your Own Datacenter video : https://www.youtube.com/results?search_query=home+data+center&oq=home+data+center&gs_l=youtube.12...0.0.1.66188.8.131.52.0.0.0.0.0..0.0...0.0...1ac..11.youtube.
Careful tips : http://www.techrepublic.com/blog/10things/10-mistakes-you-might-be-making-with-your-data-center/3480