In reality, in 2018, you need good, optimized hardware to have any chance of competing and if you can't afford a couple hundred $ a month for your hardware I'm not sure you're really in a position to be launching a hosting business, quite frankly.
Not really many hosts run successful businesses on less than that. Many start small and build up a clientbase before expanding.
Why spend $200 + a month if you have no clients and income coming in as that itself will see you fail.
I hosted for 18 years and only closed due to effect from the UK brexit vote and ran on a Managed VPS (even though i know what i am doing around servers) for $80 a month and with addons etc. in total my spend was approx. $110 a month.
Why would you close because of Brexit?