A method, system and computer program product for dynamically building a set of compute nodes to host a user's workload. An administrative server receives workload definitions that include the types of workloads that are to be run in a cloud group as well as a number of instances of each workload the cloud group should support. These workload definitions are used to determine the virtual machine demands that the cloud group will place on the cloud environment. The administrative server further receives the demand constraints, placement constraints and license enforcement policies. The administrative server identifies a set of compute nodes to host the user's workload based on the virtual machines demands, the demand constraints, the placement constraints and the license enforcement policies. In this manner, a set of compute nodes is dynamically built for consideration in forming a cloud group without the user requiring knowledge of the cloud's composition.