This is how I started doing hosted e-mails, but I recently switched to using Google Apps. If you have a small business (up to 10 users), you can use Google Apps 100% free. Gmail handles the mail, your e-mail has your domain associated with it, and you can link that e-mail up to other Google features (Google docs, Google voice, add-on apps like a CRM or accounting). Best of all, I can sync it all effortlessly with my android phone, so now all of my e-mails still come to my phone… but they’re sorted neatly by account.

Your next major concern will be compatibility. It's not a shock that most businesses run on Microsoft Windows and use some form of Microsoft Office. Being able to use common third-party clients such as Microsoft Outlook can often be a concern, and even today, compatibility with Microsoft Outlook isn't necessarily guaranteed. This is especially true when sending and receiving meeting invites. It only takes one garbled meeting invite to realize how frustrating this can be in the real world. Even if using Microsoft Outlook isn't a concern, portability is. If the service is entirely web-based, then is there a means for me to take my email offline and send email when I connect?
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