A distributed computing application is described that provides a highly elastic and multi-tenant platform for Hadoop applications and other workloads running in a virtualized environment. Data and compute nodes are separated into different virtual machines (VM). Compute VMs are used to launch containers from different tenants. Compute VMs are organized in pools of hot spare VMs that are immediately available for launching a container and executing a task, and pools of cold spare VMs. Each compute VM may include a mounted network filesystem provided by a node manager to share intermediate outputs across VMs executing on the same host.