Cutting hosting costs to improve agency margins

I run a small web design agency managing about 50 client sites. We have been using a managed hosting service for years but they just raised their prices again and it is eating into our recurring revenue.

I am thinking about hiring a part time sysadmin and moving everything to a self managed VPS setup. I have been testing virtarix and hetzner for our internal staging server and the speed is impressive for the cost. If I could move all clients there I would save nearly $400 a month. My only concern is handling support if the network goes down since I would be the one responsible.

Do any other agency owners use budget VPS providers for client hosting or is the risk not worth the extra profit?