> What we need in the small business space is a tier of services where small businesses can self host using their own on-premise, vertically scalable infrastructure (ie: 1 server). In most cases they can tolerate some downtime and, even if they don't want to, a lack of resources usually means they don't have a choice (ex: they're not running HA network connections).

I think the same: Small service businesses care most about Time To Recovery (TTR) when doing services. As long as they communicate at least by phone and the website is up, they usually tolerate downtime when they know when their backoffice services are back online.

This is classic Business Continuity Management, 5-10 questions usually make clear what must work in every case when and what has to be available for supporting this process. Example: I got a customer which prints all logistics / distribution labels in batches. They can still work where money comes in (=shipping stuff) for quite a long time (4h min, 8h max) if the next batch of labels cannot be printed / some system is going down needed to support shipping. So no need for expensive HA around legacy software, but enough time for a good process to get back online with the latest backup on replacement hardware which is already there on-site.

The thing is: HA is FAR more expensive and complicated than e.g. getting another stand-by server as fast replacement, maintain the hypervisor on this second server e.g. every six month and test restoring backups on it once a month (best: automated: IMPI boot, restore without VM networks, testing, shutdown). Same with a firewall; two used Enterprise Servers + Proxmox VE Subscription, OPNSense + 2 x N150 Hardware and two consumer WANs (e.g. Cable and VDSL) is really not that expensive if only the WAN is a bit more complicated from the POV of a SME admin because of failover. Classi VLANs+ACL and services like surveillance as needed...

> Businesses with <10-20 employees are often viewed as not being worth the effort of having as a customer, so they end up with self-serve, unsupported, non-discounted, over priced, trash subscriptions. By the time they grow enough to be a valuable customer their only experience with some products is misery.

Exactly. This is why I do SME IT since ever, no matter for which $BigCorp I've done consulting and DevOps. I automate them. I consult them. My company (plug: https://foundata.com) does it for a few bugs per month (Hypervisor, Groupware (Calendar, Mail) Firewalling, VPN, Directory Services, Jitsi/OpenCloud/BBB) if they understand that they finance the high quality of the managed services ON THEIR HARDWARE with all other customers and we do not work per-hour but per-service + we run Open Source also for other reasons than "no or fewer licensing costs".

And I like it even this does not make you rich. Because I REALLY share your concerns ("owning all the small businesses of certain types; family doctors, dentists, optometrists, vets" -> I don't know where you are from, but it is the very same here in Germany... example: https://www.ndr.de/fernsehen/sendungen/panorama3/Spekulanten...)