Pros
EXCELLENT culture. People get along, for the most part, and that contributes to Rackspace's success. Rackspace IS, plain and simple, a customer-oriented company...and it will do whatever it takes to make the customer happy. Though a good work-ethic is required to do well, Rackspace offers a very laid back atmosphere where you aren't hovered over while doing your job. (As I said, whether this is a pro or con really depends on your self-discipline in work ethic)
Cons
Terrible management organization. There are countless numbers of VPs...and lower-level managers generally have 3-4 people they report to. This company is entirely bloated (as opposed to flat) and not quite big enough to require such a structure. Ultimately this means that getting anything big done is next to impossible. Some level of bureaucracy is to be expected in any company....but the amount that exists at Rackspace can, at times, make your job to impossible at times.