In the dynamic world of fintech, where milliseconds can mean millions, the trend of adopting multi-cloud strategies is on the rise (Flexera reports that 89% of organizations have a multi-cloud strategy). Every time there is downtime in any system that deals with financial transactions, the consequences could be dramatic. No matter how your system handles failures, relying on a single cloud provider exposes your services to what I call an unmanaged failure; no matter what you do, if your cloud provider is down, your system will be unreachable.
Today, we’ll discuss the multi-cloud trend in the fintech world, and its challenges, and share some tips.
Simply put, they're not putting all their eggs in one basket. A multi-cloud strategy means using services from different cloud providers—think AWS, Azure, Google Cloud, etc.—instead of relying on just one. It's like having a diversified investment portfolio but for your infrastructure. Like a diversified portfolio, it’s unlikely that all the providers will be down at the same time; with a multi-cloud strategy in place, the impact of a cloud provider downtime on your systems and company is minimal.
There are several reasons why the fintech industry (and many others) is transitioning to multi-cloud architectures:
Implementing a multi-cloud strategy is like having a Swiss Army knife for your cloud infrastructure—versatile but with many moving parts.
At a very high level, to implement a multi-cloud architecture, you'll typically need the following.
This acts as a centralized control panel to manage resources across different cloud providers, often with features for cost optimization, resource allocation, and security monitoring. Think of it as the air traffic control tower for your cloud fleet. With a cloud management platform properly configured you save time and money, and offer visibility on the performance of your multi-cloud infrastructure.
This layer acts as an intermediary between the user and multiple cloud providers, abstracting the complexities of interacting with different APIs and services. It's like having a universal translator for your cloud conversations. The benefit of adding an abstraction layer is to reduce your dependence on specific services. If you’re no longer satisfied with your provider, or if you want to distribute your services across multiple cloud providers, you can use your orchestrator to provision replacement infrastructure without impacting your customer experience.
These tools ensure seamless data transfer and communication between different clouds, often using APIs, connectors, or even custom-built solutions. They're the glue that holds your multi-cloud world together. In a multi-cloud environment, applications and databases run on different cloud service providers. Maintaining an efficient, secure flow of data can be challenging.
Given the increased complexity of multi-cloud, robust security measures are crucial, including identity and access management, data encryption, and threat detection across all cloud environments. As we know, with great power (or cloud) comes great responsibility. Topics such as authentication, security posture, and access management to cloud resources are now more important than ever as cyberattacks are now a common and increasingly serious threat to most businesses.
Each of these components adds another layer of complexity to the system, like a multi-layered cake. And as with any complex system, there's always the risk of something going wrong. But hey, at least you'll have plenty of clouds to cry on if it does! (Just kidding... kind of.)
Think of a multi-cloud strategy as a finely tuned orchestra, with each cloud provider playing a unique instrument. This symphony of services can harmonize to create a melody of benefits that brings your business to a new level of reliability and efficiency. By diversifying your cloud infrastructure, you're not just mitigating risks – you're opening doors to improving your services' performance and cost-effectiveness.
For fintech businesses, going multi-cloud can be a game-changer because this strategy will help your company (at least) in the following areas.
It's not just about reducing the cost to make your revenues look better. With multi-cloud, you're unleashing competition between your providers. Cloud providers are constantly contending for your business, so you can leverage their hunger for market share to negotiate better deals and pricing. On top of that, you can allocate dynamic cloud resources across different providers to optimize costs.
Optimize workloads by picking the cloud that best suits each task. The result? Faster and more efficient operations. By choosing between different cloud service providers with a wide geographical footprint, a company can strategically position its data centers closer to its users.
Experimenting with different cloud offerings can spark new ideas and solutions. A multi-cloud architecture's flexibility allows for a mix-and-match approach based on specific needs (e.g., AWS for competitive virtual machine prices, Google Cloud for advanced machine learning capabilities, Azure for seamless integration with Microsoft services) that enables creativity and innovation within your company.
Data gravity is the idea that data, like a massive celestial body, attracts applications and services towards it. The bigger the data set, the stronger the pull, making it more complex (and costly) to move or process that data elsewhere. By distributing data across different cloud providers, you're essentially breaking up that massive data monolith into smaller, more manageable chunks. This approach reduces the "gravitational pull" of any single data set, making shifting from one cloud service provider to another easier.
Setting up a multi-cloud infrastructure is a complex undertaking that requires a deep understanding of various cloud platforms, networking, security, and integration intricacies. We're talking about juggling multiple cloud providers, each with unique quirks and APIs, while ensuring seamless communication and data transfer. Most organizations don't have the in-house expertise to tackle this task independently.
When you start your journey, you must be aware that you are not just dealing with managing multiple vendors but with additional tools and new technologies.
For instance, you might bring in Apache OpenStack as your cloud management tool, orchestrating virtual machines and resources across different clouds. It's like having a seasoned conductor keeping everyone in sync, but it also means learning a whole new set of rules, configurations, and best practices.
Then, you might need to introduce OpenShift to manage portable application bundles (think Docker containers) across different cloud platforms. It's a powerful tool but adds another layer of abstraction and complexity to your infrastructure.
Another component to add to your tech stack is something tailored to managing data across different cloud environments. For instance, tools like MiniIO multi-cloud data storage are great for ensuring data availability and resilience, but they also mean managing yet another interface and set of configurations.
Each tool introduces complexities: learning curves, integration challenges, potential conflicts, and the ever-present risk of misconfigurations. Even more, there are many tools on the market, and your success depends on picking the right ones with the appropriate level of freedom and support.
Once you pick your tools, you have to make some strategic decisions on the distributed and redundant deployment patterns. There are at least four distributed deployment patterns to follow when you start the migration to a multi-cloud environment.
This pattern involves gradually moving applications, starting with simpler ones. Each application requires an architectural decision (rehost, re-platform, repurchase, refactor, retain, retire). After migration, applications access the backend through an API gateway for centralized security and management.
Internet applications can experience extreme fluctuations in usage. This architectural pattern prioritizes the ability to move workloads between different cloud providers and relies on a redundant deployment of apps across multiple computing environments. The goal is to increase capacity, resiliency, or both.
Enterprise architectures have transactional systems for daily operations and separate analytical systems for data analysis. Analytics systems obtain their data from transactional systems by either querying APIs or accessing databases. In most enterprises, analytics and transactional systems tend to be separate and loosely coupled. This pattern suggests running transactional and analytics workloads in two different computing environments. Although the separation, you can always feed data back to transactional systems when required.
This is another pattern that can be used to begin your journey toward a multi-cloud architecture. It involves keeping a workload's production environment in an existing data center while utilizing the public cloud for development, testing, or other environments. The significant advantages of this approach are that you can build familiarity and confidence in the clouds and related tools in your organization and that you can automatically start and stop the development and testing environments as needed (e.g., you can provision an entire environment for each commit or pull request, allow tests to run, and then turn it off again).
To summarize, your journey to multi-cloud comes with its own set of challenges:
One option is to embrace the path of learning the technology and do it yourself during your multi-cloud migration, making it work for you. An alternative can be to hire talent with similar career experiences and learn with and from them. Another option is to bring in external experts who've been there and done that; they can guide you through the journey, help you avoid costly pitfalls, and be gone when the migration is over or when you have learned enough from them.
I recommend teaming up with a technology partner specializing in multi-cloud solutions. They can handle the heavy lifting and let you focus on what you do best: your business.
Embarking on a multi-cloud journey is a bit like planning a cross-country road trip. You wouldn't just jump into the car and start driving. Here's what you need to do before hitting the multi-cloud highway:
Imagine your product team dreaming up a revolutionary new AI-powered lending platform, but your tech team isn't prepared to support the massive computational requirements. That's a recipe for disappointment.
Do your homework, and make sure you're fully prepared before embarking on your multi-cloud adventure. The effort that goes into the alignment and analysis will be worth it when you're on your journey and roadblocks, changes in directions, and new ideas will arise.
Take a moment to:
Navigating the multi-cloud landscape doesn't have to be a solo adventure. Experienced tech partners like INSART can help you.
INSART's engineers are the MacGyvers of cloud integration, adept at weaving disparate cloud platforms and tools into a cohesive whole. They'll handle the complex configurations, data migrations, and security headaches so you can focus on what you do best: running your fintech business.
But it's not just about technical chops. INSART is also a trusted advisor, offering guidance on cost optimization, performance tuning, and even training your team to become multi-cloud ninjas. We are invested in your success, and we will be there every step of the way, ensuring your multi-cloud journey is smooth and efficient.
By working with INSART you can get help on critical areas such as:
Development of a Solid Strategy — Tailored to your specific business needs.
The multi-cloud trend in fintech is here to stay. It offers exciting opportunities, but it's not without its challenges. By partnering with the right experts, you can unlock the full potential of multi-cloud and propel your fintech business to new heights.
With over 20 years of experience in software engineering and leadership, Giorgio is passionate about creating and delivering innovative, scalable, and accessible web, mobile, and embedded systems solutions. As a seasoned engineering leader, Giorgio managed and mentored global and cross-functional teams in various domains, including fintech, payments, security, education, retail consumer industries, and browser development.
Giorgio is also an international speaker, book author, and conference organizer who enjoys sharing knowledge and insights with the community. Giorgio is driven by a vision of a web that is safe, private, and equally accessible to everyone.