The Cloud Exit Strategy: How to Run a Production SaaS for $5/Month
TL;DR
A $5/month VPS can run a production SaaS with SQLite, Better-Auth, and Docker. This eliminates vendor lock-in and reduces costs from $100/month to just $5, enabling indie developers to sustain projects longer.
Key Takeaways
- •Replace expensive managed services (Vercel, Supabase, Auth0) with a $5 VPS using SQLite, Better-Auth, and Docker to cut costs from $100/month to $5/month.
- •SQLite with Litestream for backups provides high performance (0.1ms latency) and reliability without the need for distributed databases for most apps.
- •Eliminate vendor lock-in by owning your stack, using tools like Better-Auth for authentication and Docker/Nginx for deployment, reducing dependency on external services.
- •Lower infrastructure costs ($5/month) extend runway, allowing indie hackers to experiment and wait for product-market fit without financial pressure.
- •The Boring SaaS Starter Kit simplifies setup with Next.js 15, Drizzle ORM, Stripe, and deployment guides, making it easy to deploy in minutes.
Tags
We have normalized paying $100/month for infrastructure before acquiring a single customer. It is time to return to the $5 VPS. Here is the architecture.
We need to talk about the cost of "Modern Web Development."
If you follow the standard tutorial for building a SaaS in 2026, your bill looks something like this on Day 1:
**Hosting (Vercel/Netlify): $20/month per seat
Database (Supabase/Neon): $25/month (once you hit the first limit)
Auth (Clerk/Auth0): Free tier, then expensive quickly
Redis (Upstash): Usage-based pricing**
Before you have even validated your idea or processed your first Stripe payment, you are looking at a recurring burn rate of $50–$100/month.
For a funded startup, this is a rounding error. For an indie hacker or a solo developer, this is death by a thousand cuts.
I spent the last few months architecting a way out of this trap. I wanted to see if I could build a fully functional, production-ready SaaS stack that runs entirely on a single $5/month VPS.
The answer is yes. And it is faster than the cloud.
The Architecture of Independence
The goal was simple: Zero Vendor Lock-in.
To achieve this, we have to fire the managed services and bring the logic back home. This is the stack that makes it possible:
1. The Database: SQLite (Local)
We have been gaslit into thinking we need a distributed database cluster for a todo-list app. We don't.
SQLite in WAL (Write-Ahead Logging) mode can handle thousands of concurrent writes per second. Because the data lives on the same NVMe drive as your application, query latency drops from 50ms (cloud) to 0.1ms (local).
The Backup Strategy:
The fear of SQLite is "What if the server dies?". The solution is Litestream. It streams your database changes to S3-compatible storage in real-time. If your $5 server melts, you restore your data to a new server in seconds.
2. Authentication: Better-Auth
Identity management has become a massive industry. But for 99% of apps, we just need secure sessions and OAuth.
Libraries like Better-Auth allow us to own our user data. It lives in our SQLite database, not in an external tenant. No per-user monthly fees.
3. Deployment: Docker & Nginx
This is the part most developers fear, and why they pay Vercel. Setting up a Linux server, configuring Nginx as a reverse proxy, and managing SSL certificates (Let's Encrypt) feels like "Ops work."
But once you have a docker-compose.yml file configured correctly, deployment becomes boring. You push code, a GitHub Action builds the container, and the VPS pulls it down.
Why This Matters
This isn't just about saving $50 a month. It is about Runway.
If your project costs $5/month to run, you can keep it alive forever. You can afford to wait for product-market fit. You can host 10 different failed experiments on the same server without paying a cent more.
If your project costs $100/month, you are on a clock. You shut it down if it doesn't make money immediately. High infrastructure costs kill innovation.
The Solution
I realized that the barrier to entry wasn't the code, it was the configuration. Setting up the Nginx proxy, the automated backups, and the Docker networking is tedious.
So, I packaged my entire architecture into a starter kit.
I call it The Boring SaaS Starter Kit.
It includes everything you need to deploy a Next.js 15 app with Stripe, Auth, and SQLite to a VPS in about 5 minutes.
Full Source Code: Next.js 15, Drizzle ORM, Tailwind.
Infrastructure: Production-ready Docker Compose setup.
Payments: Stripe integration with Webhooks handling.
Guide: A step-by-step manual for deploying to Hetzner or DigitalOcean.
Conclusion
You don't need a cloud budget to build software. You need a Linux server and the courage to manage your own stack.
Stop renting your infrastructure. Own it.