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Serverless Architecture: What It Is & How It Works

Forget the days of server provisioning, scaling headaches, and endless maintenance. Serverless architecture offers a modern approach, freeing developers from the shackles of infrastructure management. 

In simple terms, serverless lets you focus solely on writing and deploying code. The cloud provider handles the underlying servers, automatically scaling them up or down based on your application’s needs.  And here’s the cool part – simplicity doesn’t mean compromising. Instead, it puts the spotlight on scalability, cost-effectiveness, and efficiency.

Keep reading as we explore its core concepts, benefits, and drawbacks, and equip you with the knowledge to decide if it’s the right fit for your development journey. 

What is Serverless Architecture?

Serverless architecture is a modern way of running applications in the cloud without having to manage servers because the cloud provider takes care of them. This means you, as the developer, don’t have to worry about provisioning, scaling, or maintaining servers. 

You simply write and deploy your code, and the cloud provider takes care of the rest. It can save you time and money, and can also make your applications more scalable and reliable.

Here’s a more technical breakdown:

  • Serverless applications are broken down into small, independent functions. These functions are triggered by events, such as an API call, a database update, or a scheduled event.

  • You write the code for these functions, but you don’t have to worry about provisioning, managing, or scaling the servers that run them.

  • The cloud provider takes care of all that, including automatically allocating resources and scaling your application up or down as needed.

Benefits of Serverless Architecture

Serverless architecture offers a multitude of advantages over traditional server-based approaches. This makes it an increasingly popular choice for modern application development. The specific perks are as follows:

Reduced Complexity

Eliminate the complexities of server management, such as provisioning, scaling, patching, and maintenance; instead, shift your focus to application logic. Serverless providers undertake all arduous tasks—thus liberating you from their burden.

Increased Agility

Rapid deployment and iteration allow you to quickly deploy and update your code, devoid of concerns about infrastructure modifications; this accelerated feedback loop propels more rapid innovation, thereby shortening the time required for market introduction.

Improved Scalability

Serverless functions automatically scale up or down based on demand, implementing automatic scaling and guaranteeing that your application remains capable of managing traffic spikes without compromising its performance.


In the pay-per-use model, you only incur costs for the resources that your application actively utilizes. This way, you can eliminate idle server expenses and enhance the optimization of your cloud expenditures.

High availability and fault tolerance

Serverless providers ensure your application remains available even during failures, with automatic retries and redundancy mechanisms.

Integration with other cloud services

Easily integrate your serverless functions with other cloud services offered by your provider, streamlining development and functionality.

How Serverless Architecture Works

How Serverless Architecture Works

At the heart of serverless architecture lies the concept of Functions-as-a-Service (FaaS). Faas essentially treats small, independent pieces of code as services. These functions are pre-configured to handle specific tasks and are deployed to the cloud provider’s infrastructure. Also, as discussed previously, serverless architecture functions on a pay-per-use model, eliminating the need for developers to manage and maintain physical servers. Instead, code snippets, known as functions, are deployed to a cloud provider’s infrastructure and are triggered by events. These events can originate from various sources, such as:

  • HTTP requests: A user accessing a web page triggers a function.

  • Database changes: Updating a database record triggers a function.

  • Cloud storage events: Uploading a file to cloud storage triggers a function.

  • Scheduled events: A function runs periodically based on a predefined schedule.

When an event occurs, the cloud provider allocates resources (RAM, CPU) to execute the corresponding function. Once the function completes, the allocated resources are released, making serverless highly scalable and cost-effective.

Here’s a breakdown of the key steps involved in serverless execution:

1. Event triggers a function: An event from a source like an HTTP request or database change triggers the execution of a specific function.

2. Cloud provider allocates resources: The cloud provider identifies an available compute instance and allocates the necessary resources to run the function.

3. Function code executes: The function’s code is downloaded and executed within the allocated environment.

4. Function completes: Once the function finishes running, the allocated resources are released and made available for other functions.

5. Response or event sent (optional): The function can optionally send a response back to the triggering event or initiate another event in the serverless flow.

Hence, by abstracting away server management and offering event-driven execution, serverless architecture empowers developers to focus on building robust and scalable applications without infrastructure concerns. 

Fundamental concepts in serverless architecture:

Serverless architecture redefines how we create and launch applications. But to become proficient in serverless, one has to learn a new set of terms and ideas. Here are basic ideas that help you understand and move through the details of serverless architecture well.

Event Trigger: An event that initiates the execution of a serverless function. Events can be various things like HTTP requests, changes in a database, file uploads, etc.

Statelessness: Serverless functions are designed to be stateless, meaning they don’t retain any information between invocations. Any required state or data persistence is typically managed externally, such as in a database or storage service.

Auto-scaling: The ability of serverless platforms to automatically adjust the number of running instances of a function based on the incoming workload. This ensures efficient resource utilization.

Invocation: Refers to a single function execution. This aligns with the concept of a serverless function being triggered by an event or request.

Duration: Represents the time it takes for a serverless function to execute. This is crucial for understanding the performance characteristics of serverless functions.

Cold Start: Describes the latency that occurs when a function is triggered for the first time or after a period of inactivity. It’s important to be aware of this delay in certain serverless platforms.

Concurrency Limit: The number of function instances that can run simultaneously in one region. This aligns with understanding the scalability limits imposed by the cloud provider.

Timeout: The amount of time that a cloud provider allows a function to run before terminating it. Setting an appropriate timeout is essential for efficient resource utilization.

Billing Model: Serverless platforms typically use a payment system where you only pay for the resources you really use, unlike traditional servers that often charge for fixed amounts of space or time, even if not fully used.

Security and Identity Management: Serverless architectures require robust security practices. Identity management, access control, and secure communication between functions and other services are critical considerations.

Logging and Monitoring: Serverless applications need comprehensive logging and monitoring to troubleshoot issues, analyze performance, and ensure the overall health of the system.

Environment Variables: Parameters and configurations that can be set externally to the function code, allowing flexibility in adjusting settings without modifying the code. These variables can be used for various purposes, such as API keys, database connections, etc.

Dependency Management: Handling external dependencies and libraries in serverless functions. Proper management of dependencies ensures that the function environment has the required resources to execute successfully.

Orchestration: The coordination of multiple serverless functions and services to achieve a specific business process or workflow. Orchestration tools or frameworks are often used to manage the execution flow.

Serverless Architecture vs. Container Architecture: FaaS vs. PaaS

Choosing the right architecture for your application can be complex, especially when comparing serverless and container-based approaches. Both offer advantages and disadvantages, and the best choice depends on your specific needs and priorities. Here’s a breakdown of the key differences between serverless (Function-as-a-Service or FaaS) and containerized (Platform-as-a-Service or PaaS) architectures:

Serverless Architecture (FaaS)

  • Management: Cloud provider handles server provisioning, scaling, and maintenance.

  • Deployment: Deploy individual functions, usually small and event-driven.

  • Scaling: Automatic scaling based on demand (pay-per-use).

  • Focus: Develop code logic only, with no infrastructure concerns.

  • Complexity: Lower infrastructure complexity for simple applications.

  • Vendor lock-in: Potential lock-in to specific cloud provider platform.

  • Cold starts: Initial execution might be slower due to container spin-up.

  • Debugging: Limited visibility and control over runtime environment.

Containerized Architecture (PaaS)

  • Management: You manage container images and orchestration (e.g., Kubernetes).

  • Deployment: Deploy containers with full application runtime.

  • Scaling: Manual or automated scaling based on your configuration.

  • Focus: More control over the application environment and dependencies.

  • Complexity: Higher infrastructure complexity, requires container expertise.

  • Vendor lock-in: Less vendor lock-in, can use different container platforms.

  • Warm starts: Faster initial execution due to pre-provisioned container image.

  • Debugging: More visibility and control over container environment.

Choosing the Right Architecture:

Serverless (FaaS) is ideal for:

  • Event-driven applications with unpredictable traffic spikes.

  • Microservices that need independent scaling.

  • Cost-sensitive projects with minimal resource requirements.

  • Rapid development and deployment with minimal infrastructure management.

Containerized (PaaS) is ideal for:

  • Stateful applications requiring persistent storage.

  • Applications needing specific runtime environments or libraries.

  • Complex deployments with tight control over infrastructure.

  • Existing teams with container expertise and tooling.

Ultimately, the optimal decision is based on what you specifically need and what is most important to you. Think about aspects such as your team’s skill level, how complicated the application is, its performance needs, and budget limitations before coming to a conclusion.

Who Should Consider Serverless Architecture?

Serverless architecture isn’t a one-size-fits-all solution, but it offers unique advantages that make it particularly suitable for the following groups:

1. Developers focused on rapid development and iteration:

  • Serverless eliminates server management, allowing developers to concentrate on writing code and logic.

  • The pay-per-use model minimizes infrastructure costs during development and testing phases.

  • Automatic scaling simplifies handling unpredictable traffic surges.

2. Teams building event-driven applications:

  • Serverless functions excel at reacting to events like user actions, data changes, or API calls.

  • This simplifies the architecture and improves responsiveness for event-driven workflows.

3. Businesses aiming for cost-effectiveness:

  • Pay-per-use avoids idle server costs, making serverless ideal for applications with fluctuating traffic.

  • Automatic scaling ensures you only pay for the resources your application actively uses.

4. Startups and small businesses:

  • Serverless scales efficiently, accommodating growth without upfront infrastructure investments.

  • Reduced complexity helps smaller teams focus on core development without extensive infrastructure expertise.

5. Organizations wanting to reduce operational overhead:

  • Serverless offloads server management burdens to the cloud provider, minimizing operational tasks.

  • This frees up IT teams to focus on higher-level strategic initiatives.

However, serverless might not be ideal for:

  • State-heavy applications: Frequent data persistence can increase costs and complexity.

  • Applications requiring fine-grained control over runtime environments: Limited customization options might be restricting.

  • Teams lacking serverless expertise: Understanding event-driven programming and cloud provider nuances is crucial.

Popular tools that support serverless architecture:

Cloud Provider Platforms:

  • AWS Lambda: The pioneer in serverless computing, AWS Lambda offers a comprehensive platform for deploying and managing serverless functions. It supports various programming languages and integrates seamlessly with other AWS services, making it a versatile choice.

  • Azure Functions: Microsoft’s Azure Functions provides a serverless environment for building and deploying functions in various languages. It integrates well with other Azure services and offers features like triggers, bindings, and runtime scaling.

  • Google Cloud Functions: Google Cloud Functions is a serverless offering that lets you deploy functions written in multiple languages. It integrates with other Google Cloud services and offers features like automatic scaling and pay-per-use billing.

  • IBM Cloud Functions: IBM Cloud Functions provides a serverless platform for building and deploying functions in various languages. It integrates with other IBM Cloud services and offers features like triggers, bindings, and autoscaling.

Open-Source Frameworks:

  • OpenFaaS: An open-source platform for building and deploying serverless functions on Kubernetes. It offers portability across different cloud providers and on-premises deployments.

  • Apache OpenWhisk: Another open-source serverless framework, OpenWhisk provides a portable and extensible platform for building and deploying serverless applications. It offers features like triggers, actions, and sequences.

  • Knative: An open-source project built on Kubernetes, Knative aims to standardize serverless development and deployment across different cloud providers. It offers features like autoscaling, build packs, and eventing.

Choosing the right tool depends on your specific needs and requirements. Consider factors like cloud provider integration, supported languages, open-source vs. proprietary licenses, and the complexity of your application.


Serverless architecture has emerged as a powerful paradigm shift in application development, offering significant advantages in agility, scalability, and cost-effectiveness. By offloading server management to the cloud provider, developers can focus on crafting robust application logic, accelerating development cycles and innovation.

Whether you’re a startup seeking agility, a large enterprise aiming for cost optimization, or simply a developer drawn to the event-driven approach, serverless architecture deserves careful consideration. With the right tools and understanding, you can harness the power of serverless to build modern, scalable, and future-proof applications.

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Anshu Bansal
Anshu Bansal, a Silicon Valley entrepreneur and venture capitalist, currently co-founds CloudDefense.AI, a cybersecurity solution with a mission to secure your business by rapidly identifying and removing critical risks in Applications and Infrastructure as Code. With a background in Amazon, Microsoft, and VMWare, they contributed to various software and security roles.
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