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D J RobertsD J Roberts 

Iterable Batch APEX and Custom Staging Object

I'm looking over the batch apex for Trailhead, and I'm wondering about the Iterable parameter. In the Trailhead it says that simple SOQL queries in the batch start method can return upto 50million records; pretty cool. 

But the Iterable Batch process will revert to standard Salesforce governor limits. So my thought is create a custom object for staging of the records to be processed by the simple query, and have a scheduled APEX class that routinely runs on the target records, does the complex processing that an iterable batch would normally do, and then save them to the custom staging object to be batched up by a simpler SOQL query? 

Am I misunderstanding the Batch APEX and the Iterable parameter?