Mostly agree, although in this case I say mostly because the colo facilities where you can easily rent a single unit of space are far and few between these days. If we were still in an environment where there were tons of hosts like Verio still around, I'd say there's nothing wrong with coloing a single box.

For sure once you reach above the $10k/month level there's a very good chance that it will make sense to colo. You can fit a LOT of hardware in a single full rack, and they're like $750/month plus bandwidth and power costs (so around $1200-1700 all said and done per month).