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LightSail is like DigitalOcean/Linode/Vultr, simple fixed cost VMs and DBs only.

Does the $3.5 per month include DB as well?

You get a system that you can run anything on.

You can run a database in the same instance, but all your tables have to fit in 0.6 TB or less, and hardware failures will cause downtime and possibly corruption.

DB & API on the same instance doesn't sound ideal

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