We started focusing in on automated testing when we had 3 manual QAs (not including me), and since then every new project has started with plans for automated testing.
It's important to note that we don't do automated tests instead of manual testing. Manual testing is still important for focused review of new features/bugs, but automated tests make sure code changes aren't breaking anything elsewhere.
Also this is all about end-to-end tests (with Selenium, in our case). If you're talking about a lack of unit/integration tests within the codebase itself, that's a huge red flag. Even if quality issues aren't the end of the world, they will definitely make people reconsider using your product. Who wants to trust their financial information with unstable software? It's also making your QA team less efficient since they're having to chase down issues that would be better recognized by the dev who wrote them.