If this $800/mo. is for the 32GB setup with 1 standby, for around $4500 you can outright buy 2 servers with similar specs (E3-1240 v6, 32GB DDR4, 2 x 960GB Micron 5100 SSDs) plus you get bare metal performance.

If you have a rack set up already, even with colocation costs you will still pay less in your first year than with a cloud set up like this.

Obviously, this calculation doesn't include any engineer costs, but if you have several several racks set up, chances are you have the manpower on hand, and you're going to be saving money compared to any cloud setup, it's all a matter of how much flexibility you require.

For most businesses, people cost way more than hardware.

Sure, if you run dedicated PostgreSQL hardware you also need someone to maintain it (probably).