I have been running a blog about tech related stuff pertaining to the city of Austin for a few months now. I know is a very short time, however, in this short period of time I've seen how traffic has been increasing every week and I am starting to get some traction. About a month ago I was asked by a PR firm to help them propagate the word about a new Intel product and in exchange I got some cool HD cameras to give away to my readers. It is all cool.
I would like to move this blog away from the free WordPress.com hosting solution onto a better hosting company where I have the flexibility of using more plug-ins and custom code. I need to do this to take advantage of other tools that I want to use to make the blog more reader friendly and functional.
How do I go about approaching hosting companies like RackSpace or similar companies to see if they would sponsor this blog providing free hosting or perhaps a discounted rate? any ideas, tips?
Don't worry about sponsors -- focus on the blog's quality. Advertisers really do not care about the blog/website but rather about the audience it draws. Having a targeted and high-volume trafficked blog will attract the sponsors/advertisers, who are themselves looking for such opportunities.
Remember, they are not doing this to help you out but rather to meet their own marketing objectives.
Hosting is not that expensive. I don't understand why you would want sponsorship for an expense which is minor. If you are planning to monetise your blog, you need to invest in it at some point. If it is a labour of love then a possible sponsor would be a company who would want to promote to your readers, (which may or may not be a hosting company.)
Here's how I would do it: