What is the advantage of this? Unless you need something exotic like different kernel configurations per instance, what's the problem with using containers on the same instance?
BTW, a Hetzner dedicated server with 2 CPUs/8GB RAM that would let me run my own hypervisor is about $14 USD/month. For anyone who's a big enough power user to care about the distinction of running distributed workflows on VMs versus containers, I'm not sure that an extra $5/month is worth your "hypervisor as a service." But then again, HN commenters infamously poopooed Dropbox [0], so what do I know? :-)