I doubt that every single customer has to be on their own VM. It's more likely that many people share the same VM, and only larger customers need their own VM.
Let's run some numbers though, using your assumptions:
500 VMs @ $179 per customer (business class licence) means a little over $1,000,000. At that point, you'd be right---it wouldn't scale.
However, this is a business and not an HR exercise. So you could easily hire less people, and have less reliability. For a business like Shopify, I imagine their best customers are those who pay the $99 plan, accept a transaction cost, and other limitations. These customers can be piled onto the same VM together, and probably don't have such a huge throughput that a few minutes of downtime means money lost.
> you could easily hire less people, and have less reliability.
If your business has to be up and running 100% of the time, those are the minimal numbers needed to run the operation I've described. I cite a real word example, with real people and real money, the afterwards part if you will, which I'm currently working on to replace, not an hr exercise. And yes, it doesn't scale and it's very costly to replace, and one of the main reasons it was built in such a manner is because the original architect never thought it would have to scale and there are licensing considerations, something rarely mentioned around these parts. Licensing can really fuck things up.
Let's run some numbers though, using your assumptions:
500 VMs @ $179 per customer (business class licence) means a little over $1,000,000. At that point, you'd be right---it wouldn't scale.
However, this is a business and not an HR exercise. So you could easily hire less people, and have less reliability. For a business like Shopify, I imagine their best customers are those who pay the $99 plan, accept a transaction cost, and other limitations. These customers can be piled onto the same VM together, and probably don't have such a huge throughput that a few minutes of downtime means money lost.