I use Java primarily in my day job, but usually RoR in my side projects (unless I'm using something else just to pick up the language/skill).
I think the reason you don't see Java in startups as much anymore is that it's neither rapid nor enjoyable to code in. It's also more difficult to deploy in production and more expensive (it requires more RAM to run well in my experience). Continuous deployment is more difficult with Java. Ruby and PHP you can just push code and restart the server almost instantly, Java takes longer.
Java is getting better, but not fast enough, and it's still not a fun language to write in. If I'm going to spend 12 hours coding, I'd like to enjoy it. I can think faster than I can write Java. I'm just able to get more done with other languages.