Techniques are disclosed for scalable virtualization of tenants and subtenants on a virtualized computing infrastructure. In one example, a first controller for the virtualized computing infrastructure configures underlay network segments in the virtualized computing infrastructure by configuring respective Virtual Extensible Local Area Network (VXLAN) segments of a plurality of VXLAN segments of a VXLAN in a switch fabric comprising network switches. Each VXLAN segment provides underlay network connectivity among a different subset of host computing devices of the virtualized computing infrastructure to enable orchestration of multiple tenants in the VXLAN. A second controller for a first subset of the host computing devices has underlay network connectivity through operation of a first VXLAN segment. The second controller configures overlay networks in the first subset of the host computing devices to enable orchestration of multiple subtenants in the first subset of the host computing devices.