I'd be curious to know what kind of problems could be only solved through a cloud-only solution. It's a honest question; I'm not old enough to remember actually using mainframes but in my days companies had their own IT staff, gear and storage. I understand that hiring a IT team of 3 could not be viable for a small 10 people startup, but I'm sure there are solutions in between before being forced to entirely surrender everything to someone else's data center.
Building an in house solution to do this is extremely costly in every way imaginable, from the extreme expertise needed, to the ability to do it at a very large scale.
There are a number of vendors out there who provide great software to do things like scan source code, scan dependencies, or scan a live environment for vulnerabilities. The best of those vendors have cloud-only solutions.
You're stuck either accepting the risk that, at the very least, vulnerabilities about your software would be potentially exposed for the world to see, or installing an inferior product on-premise. That potential risk is even greater if your customers depend on you to store things like private and/or financial data.
So, color me unimpressed.
The company can recognize that "there is no choice" is not a valid option. There are many choices if the company actually cared to invest into choices. That requires learning and actually vetting your vendors though. That's hard work. Good luck getting people to do hard work.
That said, good luck implementing and managing that in a large organization.