Yes, having a performant CI server on premises would probably pay itself in less than three months.

Startups are usually resource-rich and time-poor, and don't want to allocate employee time to infrastructure unless it's core to their business, so arguments for efficient spending there are easily overlooked.

We used to have self-hosted runners on Hetzner dedicated servers, and we migrated to UbiCloud ~6 months ago.

Unless you can optimise your CI runtime to be very balanced and fast, you're going to have a lot of jobs queued during working hours ... although it costs more per minute, the fact that CI jobs are bursty means it works out not too much costlier but with less queue time.