Most website owners start out using shared web hosting. In time, as their site grows and demands more resources and functions, they may need a more powerful hosting option. A virtual private server (VPS) is generally considered as the stepping stone between shared hosting and a dedicated hosting setup in which your website runs on its own server. Let’s break hosting types down using a simple analogy.

Shared hosting is like living in an apartment; it’s cheap and can come furnished with everything you need to move in. The tradeoff is sharing facilities with many other people (sharing resources with the other accounts on the same server), and if you throw a massive party (have lots of traffic), building management will want to talk to you. A dedicated server is like having your own house with acres of land around it. All resources in the house are for your sole use and you won’t be bothered by your neighbors, even if you do throw a party (experience high traffic).

VPS lies somewhere in the middle. It behaves like dedicated server but with an allocated system resources. Let’s equate VPS to a townhouse, it's bigger than an apartment (shared hosting) but you shared the property and certain services. What’s more, throwing a party (having lots of web visitors) is easier.