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Virtualization Companies See Gold in Them Hills

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by James Maguire

This recent article about emerging virtualization companies reveals that there are scads of deep-pocketed equity groups eager to invest. Clearly, VMWare's rocketship success demonstrated that there's gold in them virtual hills.  

Find the right company, invest when they're needy, and turn that slender dollar in your pocket into a whole fist full of dollars. It's magic. (Or, it is when you pick the right startup...) 

As reported by Jeff Vance for Datamation, some of the biggest harvesters of VC bucks among the 10 virtualization startups are: 

Crossbeam Systems: approximately $100 million from Matrix Partners, North Bridge Venture Partners, and Tudor Ventures. 

ScaleMP: $26 million from Sequoia Capital, Lightspeed Venture Partners, TL Ventures and ABS Ventures.

Zenoss: $20 million from Grotech Ventures, Intersouth Partners, Boulder Ventures, Amplifier and Silicon Valley Bank.

RingCube Technologies: $16 million from New Enterprise Associates and Mohr-Davidow Ventures.

The investments appear spread across a number of sub-sectors within virtualization. Crossbeam, Synscort and HyTrust, for instance, focus on security, while RingCube targets the expanding world of desktop virtualization. ScaleMP aggregates groups of x86 systems into one pool -- sometimes called a 'private cloud,' while Virsto is eyeing the virtual storage market. 

Which one will turn into the next VMware? 

Obviously hard to say, but two tactics will probably distinguish the winners: 1) They'll go after the SMB market, which is vast and has been slow to hop on the virtualization train, so there are still easy pickings, and 2) They'll make their services as clear and understandable as possible. Yes, they're selling to a sophisticated IT staff, but I've read and heard from more than one source that the complexity in the cloud/virtualization concept really slows down the sales pitch. 

Good luck, and may the hungriest startup win. 

James Maguire is senior managing editor of Internet.com's IT Management channel.

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