I have a friend interning at Hadoop over the summer. I'm particularly interested in how their business model will work. Their branch of Hadoop I believe is being offered for free, and they're basically cloud computing consultants with the goal of customizing Hadoop for different industries/clients. It's a huge market opportunity.
Running a consulting firm around Hadoop and related technologies makes a lot of sense, but taking VC funding to do so is surprising, IMHO (Cloudera are backed by Accel and Greylock). A consulting firm has relatively small capital requirements, but is fundamentally less scalable than a "product" firm: to make 2x revenue, you need ~2x the staff. I'm curious to see whether they'll be able to achieve the sort of returns that a typical VC expects if they stick to a purely-consulting business model.
Cloudera have taken ~$11M in VC funding so far[1]; is there really ~$110M in profit to be made off Hadoop consulting, training and support in the medium term? I wonder.
One possibility is that they're using consulting to build revenue and mindshare in the short-term, and using the capital they've raised to launch something more substantial in the longer-term (say, running their own cloud/hosted Hadoop service).
