The SMB I work for runs a small on-premise data center that is shared between teams and projects, with maybe 3-4 FTEs managing it (the respective employees also do dev and other work). This includes self-hosting email, storage, databases, authentication, source control, ticketing, company wiki, and other services. The current infrastructure didn’t start out that way and developed over many years, so it’s not necessarily something a small startup can start out with, but beyond a certain company size (a couple dozen employees or more) it shouldn’t really be a problem to develop that, if management shares the philosophy. I certainly find it preferable culturally if not technically to maximize independence in that way, have the local expertise and much better control over everything.

One (the only?) indisputable benefit of cloud is the ability to scale up faster (elasticity), but most companies don’t really need that. And if you do end up needing it after all, then it’s a good problem to have, as they say.