If you truly need cloud hosting then that is $130k of free money no? That's more than many pre-seed rounds. If you use that for a bunch of Linux machines running some kinda containers and a non-proprietary database then I don't see any downsides.

This ignores the other big reasons to take losses early, when one is a new(er) player in a market with a dominant competitor.

It's not completely wrong, but incomplete.

Doesn't the same logic apply -- that new upstart is unproven and is essentially paying people to use their platform. The last thing your burgeoning new business needs is trying to debug issues on a brand new platform, you can't even hire industry experts to help because there are no industry experts.

So if you want to work on building your business and not debug cloud provider issues, avoid the new upstart.