We are not going to compile to C, however we will to LLVM IR (not directly though). During the first release we will provide Luna interpreter (so yeah, some kind of custom VM). We are however already working on the backend that compiles Luna to Haskell's GHC Core (https://ghc.haskell.org/trac/ghc/wiki/Commentary/Compiler/Co...), which then gets different functional-programming related optimizations and translates to LLVM IR.