We have had an extranet built on SharePoint since 2006 and we made the initial decision to put each client into their own site collection. I know that's a lot of site collections and for us, since we put each site collection in it's on databases, it's a lot of databases. But we feel like that decision was the correct one. It also leaves the most oportunity for growth and meeting the needs of the client.
FYI, here's a link to a case study done by Microsoft on one of our clients that uses our extranet: http://www.microsoft.com/casestudies/Case_Study_Detail.aspx?CaseStudyID=4000003041