The sweet spot of any Magento project from hosting standpoint is when traffic patterns allow that all services store in question needs, fit on a single more or less powerful machine. Having that singe IP address you connect to in order to deploy code, do system upgrades when traffic is low and monitor when traffic is high is super convenient. But as store grows in terms of traffic, sooner or later you'll be forced to think horizontally. This usually means adding load balancer, couple of frontend nodes as well as dedicated servers for other services your store requires. In other words, you need more machines configured in private network working together in order to serve more traffic. There are many challenges to setting up and maintaining such system, with having fast network through which your nodes communicate being the most important component of your infrastructure.