Thanks to Heroku, my startup pays $0/year for a sysadmin/devops team.

I can't agree enough (with the sentiment about savings, though I guess I also agree that you pay $0/year for sysadmins).

I think we must have a collective blind spot here - we're so excited to save money by renting virtual servers by the hour with AWS, but not so excited to save money by not having to hire sysadmins.

Not quite. Your pricing for ops is just included in the price of your Heroku deployment.

Could you elaborate? I used to think Heroku was a premium "managed" service with pricing to match, and I paid for it because I really didn't want to think about servers, routing, etc. etc. But I just recently provisioned a small "cloud server" (their name, not mine) from Rackspace and while I was in there I decided to price out a comparable setup to what we have with Heroku and I found that the pricing was pretty comparable, and I like Heroku's horizontal scalability (and how much of the stack they manage for us) much better.