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Is it feasable to create a server that spawns virtual machines

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I have a spare machine at home and i was wondering how much effort it would be to setup a ubuntu server that you can spawn an instance of a server in a few minutes for testing stuff, similiar to digital ocean droplets.

I've suppose we would need to install xen or openvz, then perhaps some web interface (or ssh in and use a command) that we can use to spawn an image of ubuntu server already setup and on a brigided connection.

basically my question is: is this feasable to setup as a weekend project? has anyone tried his?

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