When we designed the (by now largely self-hosted) stack for our production enviroment, we had that discussion. And honestly, on the persistence side, most people agreed that PostgreSQL, S3 and a file system for some special services is plenty. Maybe add some async queueing as well. Add some container scheduling, the usual TLS/Edge loadbalancing, some monitoring and you have a fairly narrow stack that can run a lot of applications with different purposes and customers..

We (10 people) run this + CI on just a VM + storage provider, mostly VSphere from our sister team of 6 (and yes it hurts, and we have no time to move it), Hetzner and some legacy things on AWS.

Though that's currently the problem -- there is a somewhat steep minimal invest of time into this. But that's good, because this means there could be value for European cloud providers to build up this narrow stack managed and get paid for it. We will see.