As a new webhosting user, I believe you are searching cheap provider company to save some money. But does it work efficiently to reach your target. From my experience as a long term user, sorry to say NO; it does not help.
If we come deeply into this issue; all free webhosting companies will not give you a high level domain, and that is very important to get listed in the search engines. Usually, free web hosting offers you a sub domain which looks like this: w w w. Your domain. theirdomain. com. In other words, the search engines optimization see theirdomain.com not your domain as your domain is only a sub of their domain and therefore theirdomain.com is what gets up in the search engine rankings, so you are working for them my friend, not for yourself. If you would like to have some personal sites that you wish to share with family and friends then a sub domain is good because it is not business issue. But if you are building a business that you need to have a good traffic to, then you should have w w w.your domain. com. And to have it you would need to pay for affordable and reliable webhosting and you will also have to pay for the domain name. But if you join Vexxhost with yearly plane, they would offer you a free domain name. Plus unlimited bandwidth and unlimited email accounts, unlimited hosting space and many many other great features.
These days, most webhosting are cheap hosting. If you are sure of your business you can pay for 1st and 2nd year in advance. But if you are not sure about your online business and maybe you will quit, you can cancel your hosting account. As an example Vexxhost form my experience will refund the unused period, they have also 30 days guarantee money back. But for the domain name no webhosting company will refund as it is registered dowmain for you.
To conclude, go with the cheap webhosting and start building your own business.