This is probably the real reason for bundled cloud provider popularity. It’s way easier for competent engineers to cut out the brigade of uninformed and cheap managers of the IT budget when you distill your specs into an AWS credit card charge.
For a small startup of competent people this is unneeded, but those companies typically succeed or fail into mediocrity eventually.
It's only 80% of the reason. The other 80% is all the time wasted dealing in the physical world, moving and plugging servers.
You could have the most competent engineer fully backed by the company, it's still going to take weeks to procure a goddamn server because it takes time to fight DELL and ship to the colo and have remote hands put it in place and set it up and a thousand more things.
for sure, the friction of managing physical servers is much higher. it would be worthwhile if a company commits to managing those physical assets well, which very few would commit to doing
For a small startup of competent people this is unneeded, but those companies typically succeed or fail into mediocrity eventually.