We did this years ago.....and when we did, we bought and used a product called RBackup.
http://www.remote-backup.com/rbackup/
When we started out, our office sub letted in a data center. That data center had massive bandwidth, a secured room, generator backup, fire suppressant system, keyfob door security system. We had the server running on a real server...an IBM X series....it was a used server, with a new NAS attached to it for storage on RAID that was expandable as needed. This was back in the Server 2000 early 2003 days. Our bandwidth was effectively free (multiple OC-3's), our electricity was free....included in the small rent we paid. We gave the data center lots of clients and resold their services...T-1's, Motorala Canopy wireless T1's, managed DSL RLANs, e-mail filtering and hosting, website hosting, server colo's, etc...so we basically had it all for nearly no cost....except for buying the NAS and the RBackup license.
Even then....it wasn't really profitable for us. Time spent maintaining the server, monitoring it, refreshing hardware on a regular cycle.
But we wanted to move away from that, for several reasons.
*The expense of doing it right. You offer a service as important as backup, you need to put an SLA on your service. So you need at the minimum quite a few things. Business or enterprise bandwidth. Generator backup. Server grade hardware, refreshed at regular intervals to ensure reliability and performance. You need to secure that server that hosts the backup....no only on your network, and secured behind a firewall, but also physically...a secured and monitored server room. And along these lines...you need to guarantee that service...what happens if something happens to your building? Fire, flood? You really need to have an offsite redundant failover site. If some disaster strikes your region...and you have local clients that get wiped out, and you're taken out too...and they come to you and need their backups restored....you're going to hung out to dry!
If your clients have data that falls under PCI or HIPAA....and you hold that data....you need to comply too!
So when we moved out to our current offices....we made the decision to get away from hosting ourselves. We didn't do it right...we were fairly close, and we were able to pull most of that off for very little cost...basically for free...and we didn't really find it profitable. Now that we have our own office, even with our server room and enterprise fiber pipe and heavy duty firewalls and tons of server hardware....we still would need to get a redundant site...and there's no way we could make a profit.
Carbonite is only 800 bucks a year for a server. That's under 70 bucks a month. So you're going to try to come up with a solution to backup a clients server....for probably 50 bucks a month, or less...and still try to make a profit? Your time should be worth at least 100 bucks an hour. So you get some hardware...lets say you get the hardware for free....and you built it...there's a few hours. You will use electricity each month running that server, you will eat into your bandwidth, you need to spend time each month monitoring the server, doing updates, checking logs, getting a beefy UTM firewall in front of it, You've more than used up that little 50 bucks a month here....you're in the hole...where's the profit?
What kind of backup does the client need? Just data? Or do you want images of the server? So that you can restore to bare/different metal? If they want images back up....the cost goes way up...and it's really hard to do a proper backup that is less than 100 bucks a month. And you shouldn't have to! The client really needs to make a decision of "How much is my data worth? How much will I be hurt if my server crashes and I'm down for several days?"
The client can pay now (for a proper backup)...or pay way way more later (when the server crashes or their network gets crypto'd and they're down for at least several days because they didn't have a good backup).
If the client insists on just a cheap, file backup system (no images)....I don't see how you can beat the costs of some cloud backup systems, such as JungleDisk....where their server license costs just 5 bucks per month...the first 10 gigs are free, and it's 11 cents per gig (and less if you have a bigger reseller package) for additional gigs. How can you come up with an in-house solution that is less costly than that?