Buddypress/Multisite large scae site

I am going to design a community site based on buddypress/multisite. I have worked with buddypress/multisite, but never with such a large userbase. There may be 500 users online working actively with buddypress (main site) / their own subsites. My question is:

• What kind of setup (hosting, server) do you recommend for fast and

reliable buddypress/multisite? Can 1 server handle such a load without

slowing down?

• What about plugins? I guess at least Multi-DB plugin is obvious

here. What about easy backup solution for Multi-DB?

• Do you recommend caching for speed in this case? Which cache plugins work well with this

kind of setup?