Personally I don’t publish any new year resolutions, but it’s definitely the season for making them. Your customers are thinking about the services they’ll adopt and some even have fresh budgets to start spending. A crucial decision that CTOs face is whether they want a single-tenant or multi-tenant architecture for the SaaS services they buy in - or that they’re offering. In this article, I’ll delve into the differences between these two approaches. I’m putting a particular focus on SaaS single-tenancy, its pros and cons, and strategies that SaaS providers have for scaling and optimizing when delivering single tenancy to their customers.

Single-Tenant vs. Multi-Tenant Architecture

Before diving into the specifics of single-tenant architecture, it’s essential to understand the fundamental differences between single-tenant and multi-tenant architectures.

Single-Tenant Architecture refers to a setup where each customer or tenant has a dedicated instance of the application or service. In this model, isolation is achieved through separate physical or virtual resources, databases, and network segments. Each tenant enjoys an environment that is entirely isolated from others, ensuring data privacy and customization.

Multi-Tenant Architecture, on the other hand, hosts multiple tenants within the same environment, often sharing resources and infrastructure. Isolation between tenants is typically achieved through logical and data-level segregation. This approach offers cost-efficiency and easier maintenance but requires robust security and data isolation mechanisms.

For a more detailed understanding of these architectural differences, AWS’s whitepaper on SaaS tenant isolation strategies provides architectural diagrams and valuable insights. For a quick and easy to read article, check out our previous post on cloud tenancy types.

Pros and Cons of Single-Tenant Architecture

In certain scenarios, single-tenant architecture can be a strategic choice. However, it’s important to recognize the advantages and disadvantages it entails.

Pros

1. Data Isolation: Offering single tenancy provides the highest level of data privacy and security. A typical architecture ensures that each tenant’s data is entirely segregated from others, making it ideal for highly regulated industries with stringent compliance requirements.
2. Customization: Tenants can enjoy tailored environments, including configurations, features, and even user interfaces, to meet their specific needs and preferences. Often you don’t want to offer this to all your tenants; a really common pattern is to limit this to a top pricing tier.
3. Predictable Performance: With dedicated resources, you can ensure consistent performance, which can be vital for applications that demand high availability and low latency. You also avoid the noisy neighbour problem.
4. Tenant Cost Tracking: Billing and cost allocation are straightforward in single-tenant setups, as the infrastructure costs for each tenant are clearly defined.

Cons

1. Scalability: We often recommend AWS accounts as the unit of isolation for silo tenancy in order to address clients’ compliance and security needs. Some SaaS providers we work with operate in highly regulated environments like the health and banking sectors and their requirements impose strict isolation of customer accounts. However, as your SaaS platform grows and you onboard more customers, managing a large number of isolated accounts can become cumbersome. Having 10-20 siloed accounts is still manageable from the operational point of view but how about managing hundreds or even thousands isolated accounts? Not so easy…
2. Resource Optimization and Cost: It’s challenging to optimize resources and achieve economies of scale, as each tenant’s resources are dedicated solely to them.
3. Agility and Growth: Maintenance and administration tasks can become a bottleneck for scaling and growing the platform, leading to operational inefficiencies. The SaaS model is ideal when each customer does get the same version of the same software (whether or not their experience has custom branding or behaviour). Sole tenancy gives you the option to run different software for different customers - and, for your target market, that may be really important. However, managing all the different services at scale comes with its own challenges.

Scaling Single-Tenant Architecture: Automation Solutions

To address the scalability and cost challenges inherent in single-tenant architecture, CTOs should consider leveraging automation strategies.

For example, as new clients are onboarded on your SaaS product and the number of siloed accounts increases, employing automation for account provisioning is essential. AWS Control Tower is a valuable tool that can help streamline this process, allowing you to manage and provision accounts efficiently.

I mentioned above that single-tenant architecture simplifies cost tracking - however, optimizing costs can be complex. To mitigate this challenge, consider implementing automated resource monitoring and right-sizing solutions. Regularly audit resource usage, identify idle resources, and implement cost-saving measures. AWS Trusted Advisor helps you with all these tasks. You may need to subscribe to the AWS business support plan to unleash the full set of checks.

Finally, embrace managed services, automation features and Infrastructure as Code tools such as Terraform to automate the deployment and management of cloud resources. Clean code and pragmatic tools for time-consuming infrastructure work let you and your team cut the time you put in to maintenance, security incident response and other updates - removing a common barrier to business growth.

Conclusion

Single-tenant architecture is a strategic choice for industries with stringent compliance requirements, offering unparalleled data isolation and customization. However, it comes with scalability and cost challenges that can be mitigated through automation. By implementing tools like AWS Control Tower and embracing Infrastructure as Code, CTOs can ensure that their single-tenant architecture remains agile, cost-effective, and poised for growth.

In the end it’s all about finding the right balance between isolation and efficiency to meet the unique needs of your SaaS business.

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This blog is written exclusively by The Scale Factory team. We do not accept external contributions.