Members of the P450 enzyme family catalyze the oxidation of many different, but primarily lipophillic, substrates. In eukaryotic P450s, a membrane-anchored N-terminal helix tethers the enzyme to the membrane. However, in bacterial P450s, no N-terminal helix is present in the sequence, and the proteins are found to be soluble and amenable to solution experiments. Through unbiased classical molecular dynamics simulations, we demonstrate that these soluble enzymes bind to lipid membranes in the same orientation as tethered P450s. We postulate that the observed membrane binding improves the turnover of the enzyme by co-locating the enzyme at regions of high substrate concentration. Through mathematical modeling, we determine that the small cellular volume in prokaryotes is the primary reason that no N-terminal helix is found in these enzymes, as fewer enzymes are mistargeted into the small cytoplasmic space.