Open source for that sort of product (which most of the big switches away from open source have been about) only further entrenches BigCloud's dominance over the ecosystem. It absolutely breaks the notion that you can run a profitable business on open source. BigCloud basically always wins that race even if they aren't cheaper because the company is using BigCloud already, so using their hosted version means cutting less yellow tape internally since the difficulty of getting people to agree on BigCloud is much lower compared to adding a new third party you have to work with.
The general response to this issue from the open source side tends to just be to accuse the original developers of being greedy/only wanting to use the ecosystem to springboard their own popularity.
---
I should also note that this generally doesn't apply to the fight between DHH and Mullenweg that's described in the OP. DHH just wants to kick a hornets nest and get attention now that Omarchy isn't the topic du jour anymore - no BigCloud (or for this case, shared hosting provider is probably more likely) is going to copy a random kanban tool written in Ruby on Rails. They're copying the actual high profile stuff like Redis, Terraform and whatever other examples you can recently think of that got screwed by BigClouds offering their services in that way (shared providers pretty much universally still use the classic AMP stack, which doesn't support a Ruby project, immunizing DHHs tool from that particular issue as well). Mullenweg by contrast does have to deal with Automattic not having a stranglehold on being a WordPress provider since the terms of his license weren't his to make to begin with; b3/cafelog was also under GPL and WordPress inherited that. He's been burned by FOSS, but it's also hard to say he was surprised by it, since WP is modified from another software product.
[0]: Including the AGPL, it doesn't actually do what you think it does.
Doesn't need a custom ROM, but it's so goddamn annoying that you might as well not bother. I know how to do these things; most users won't and given the direction the big G is heading in with device freedom, it's not looking all that bright for this approach either.