Same theme, same plugins, same content, same database dump. Five on a $6/month VPS I configured myself, five on a well-known $35/month managed host. Measured over three weeks.
Time to first byte, median, from four regions
VPS: 218ms
Managed: 141ms
TTFB, 95th percentile
VPS: 1,340ms
Managed: 290ms
That second table is the whole story. The median is close enough that you would never notice in a speed test — which is exactly what people run before declaring the cheap host fine. The tail is where the difference lives, and the tail is what your actual visitors hit at the wrong moment.
Load test, 200 concurrent
VPS: errors at around 90 concurrent without tuning, 160 after I spent an evening on it
Managed: no errors, no intervention
What it actually cost
The VPS saved $29/month, so $348 a year. I spent roughly seven hours setting it up properly and about an hour a month since. At any sane hourly rate the saving is gone before month three.
When I would still pick the VPS
If you are running ten sites on one box the economics flip completely, and if you need control the managed host will not give you, there is no decision to make. For a single site that earns money, paying the $35 is the correct lazy answer and I say that as someone who enjoys configuring servers.
Infrastructure nerd. Proxies, VPS, headless everything.