From a design perspective it still has a lot of friction on signups though, we're asking users to make a server choice before they even remotely understand what that entails. That simple decision made me spend a week understanding the fediverse before settling on Lemm.ee, but the average user won't do that, they'll get confused and then leave.
From a more traditional UX standpoint the general feed is also fairly bad, reddit has built in feeds for the things people care the most about (trending and subscribed) that pop up by default when opening the app or website, and gives the advanced controls off to the side. Lemmy on the other hand defaults to a feed that shows basically nothing, and only gives the advanced controls to fix it. For a new user that isn't tech savvy, the fact that the feed defaults to local is enough to make Lemmy seem completely dead if they happened to join a small instance.
These aren't major issues for us, but they are major issues for widespread adoption. It needs to be so easy that you can use it accidentally, and the UX isn't there yet. I'm sure we can fix issues with the feed and the app, but I do worry that the server choice problem isn't going to get a good solution
Lemm.ee has horizontal scaling, and afaik it's the only lemmy instance to have added it. He has a sticky on meta@lemm.ee that talks about how he's using a half dozen different servers to split the load, although there's a few services that can't be split like image caching, so they just get their own server. I think the changes are being pulled into future updates so hopefully other lemmy instances can start doing the same