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10 Emerging Virtualization Companies Shaking up Datacenters in 2010

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One of the virtualization companies who responded to my request for information asked me, “What exactly does ‘emerging’ mean?” Good question, especially since I badger marketing pros about ambiguous language like this all the time.

For the sake of this article, let’s say an “emerging” virtualization company isn’t one of the first ten or twelve companies you think of when you think about virtualization. This definition, though, rules out 2010’s top emerging virtualization company: Microsoft.

You’re probably shaking your head and asking how in the world a behemoth like Microsoft could be considered “emerging.” Simple, they went from a virtualization punch line to a heavy hitter in a very short time. Granted, that’s the Microsoft playbook, but the fact that Microsoft is including virtualization tools in Windows 7 means they are slowly but surely conquering virtualization in the same way they did the desktop.

This time around, however, no one will be taken by surprise. Competitors have been preparing for this eventuality for quite some time. Will that foreknowledge be enough for VMware, Red Hat, Sun/Oracle, et al. to keep Microsoft at bay?

Hard to say. The following ten companies aren’t waiting to find out. Each has a unique solution that tackles some of virtualization’s most bedeviling problems.

1. Crossbeam Systems

What they do: Crossbeam’s X-Series security platform virtualizes best-of-breed security applications (Check Point, Trend Micro, Sourcefire, etc.) on a single carrier-class chassis. While everyone knows that layered security is a must these days, managing, paying for and patching those layers is a big headache. Crossbeam intends to alleviate that headache.

Customers: Customers include both service providers and traditional enterprises, including AT&T, Telefonica and O2 on the service provider side, and Bank of America and Fujitsu on the enterprise side.

Funding: ~$100 million from Matrix Partners, North Bridge Venture Partners, and Tudor Ventures.

Tom Sheehan, CFO, is Crossbeam’s acting CEO for the time being. The company is in the process of bringing in a new CEO but isn’t ready to announce anything yet. Sheehan was most recently CFO of Egenera.

Headquarters: Boxborough, MA.

2. HyTrust

What they do: According to HyTrust, organizations cannot rely on virtualization when sensitive information is at stake. Additionally, for certain regulatory compliance requirements, such as SOX and PCI, organizations must be able to assure that adequate processes and controls are in place.

HyTrust provides a network-based virtual infrastructure policy enforcement solution. The HyTrust Appliance delivers administrative access control, enforcement of policy across virtual infrastructures, hypervisor hardening, and audit-quality logging.

Customers: Active Networks, Federal Reserve Bank of Chicago, “one of the largest insurance companies,” and others.

Funding: $5.5 million in Series A funding was secured in April 2009, led by Trident Capital and Epic Ventures.

Eric Chiu, President and CEO, previously served in executive roles at Cemaphore, MailFrontier and mySimon. Before that, he was a VC at Brentwood/Redpoint and Pinnacle.

Headquarters: Mountain View, CA.

3. RingCube Technologies

What they do: RingCube is a desktop virtualization company. RingCube’s vDesk approach to virtual desktops is a novel one that they refer to as “workspace virtualization.” While RingCube offers standard “hosted” desktops, their vDesk platform moves beyond this use case to enable truly portable desktops.

Users can download and store their entire desktops, complete with all their applications, settings and personalization, on a USB 2.0 drive. For remote and mobile workers, they take their corporate desktops with them. For organizations working with contractors or guests needing temporary computing access, vDesk can partition desktops on PCs or offer hosted access. Through vDesk, IT has the ability to enforce policies, revoke desktops as soon as a guest’s status expires and push out patches and updates.

Customers: RingCube claims customers across several verticals, including financial services, government, healthcare, manufacturing, and technology. Their biggest named customer to date is the banking giant ING Group.

For individual users, RingCube provides a free version of the software called MojoPac . Combined, vDesk and MojoPac have been downloaded more than one million times.

Funding: $16 million in two rounds of funding from New Enterprise Associates and Mohr-Davidow Ventures.

CEO Pete Foley served as President and CEO of Port Authority Technologies before joining RingCube.

Headquarters: Mountain View, CA

4. ScaleMP

What they do: According to ScaleMP, the majority of virtualization projects focus on server virtualization for partitioning and consolidation. ScaleMP’s vSMP technology focuses not on virtualizing within server environments, but rather aggregating multiple industry-standard x86 systems so that they appear to function as a single logical system.

Think grid computing meets virtualization.

Customers: ScaleMP has more than 150 customers including Coventry University, San Diego Supercomputer Center, Southern Methodist University, Massachusetts General Hospital and R Systems.

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

Shai Fultheim, founder, President and CTO, was formerly CTO of BRM Capital, an Israeli VC fund, where he defined the fund’s technology roadmap.

Headquarters: Cupertino, CA

5. SIMtone

What they do: If you visit the SIMtone website, you’ll see that their messaging is all about the cloud. Of course, there is no solid line of demarcation between where virtualization ends and cloud computing begins. My point of view is generally to consider virtualization an “enabling” technology and cloud computing a delivery or even business model, though granted, that’s an oversimplification.

In this case, SIMtone’s Universal Computing Platform “enables carriers and service providers to build, configure, manage and deliver on-demand virtual hosted services.”

What caught my attention is SIMtone’s take on desktop virtualization. Instead of serving up desktops, SIMtone delivers a universal application or service experience by “consolidating applications and services in the cloud and making them accessible via a single sign-on, regardless of the edge device used.” Of course, a virtual desktop could be part of this app/service mix, but it wouldn’t be the entire experience.

As the importance of the desktop wanes, having virtual versions of other UIs, such as browsers, will be every bit as important.

Customers: Customers include Hong Kong-based CSL (a subsidiary of Telstra) and Thomson. SIMtone also claims that several other major telecom providers are trialing SIMtone services/products in Europe, Asia and North America.

Funding: Angel funding and an undisclosed amount of VC funding from Motorola Ventures and other sources.

Mario Dal Canto is SIMtone’s Chairman and CEO. Prior to SIMtone, he was President, CEO and founder of Cybertel and, before that, founder and CEO of Impres.

Headquarters: U.S.: Durham, NC. International: Vevey, Switzerland.

6. Syncsort

What they do: Syncsort provides data protection software targeted at the server virtualization market. Using a block-level incremental technique, Syncsort’s BEX product provides low-impact backup for virtual machines, allowing for greater virtual machine density. On the restore side, BEX offers a cool feature called “Instant Virtualization,” which allows a backup image to be restored as a new virtual machine.

BEX can also function as a physical-to-virtual or virtual-to-virtual migration system.

Customers: MB-Holding, HVAC manufacturer Taco, Kerzner International, and others.

Funding: Not disclosed at press time.

CEO Flavio Santoni was previously with LSI, where he held a number of roles, including EVP and Co-GM of the Engenio Storage Group, as well as SVP of worldwide sales, marketing, and customer support for the LSI storage systems division.

Headquarters: Woodcliff Lake, NJ.

7. Venyu

What they do: Venyu provides data protection, recovery, and availability services tailored to support enterprise-level SLAs. According to recent research from analyst firm Enterprise Strategy Group, 30 percent of midmarket organizations identify improving backup and recovery as a top IT priority over the next 12-18 months. As storage capacity grows at a rate of more than 20 percent annually and the business impact of downtime intensifies, IT managers are looking for ways to reduce the risks and costs associated with protecting vital company information while also minimizing the amount of time needed to maintain backup solutions.

Venyu addresses these concerns with a backup and recovery portfolio that includes online data backup, physical and virtualized recovery solutions, managed hosting, SaaS, and co-location services.

Customers: Venyu customers include many small- and medium-sized companies, hospitals, medical societies (Louisiana State MS, Massachusetts MS), school districts and NFL Teams (Packers, Colts, Jets).

Funding: Venyu is the result of the April 2009 merger between data-protection company AmeriVault and the Network Technology Group (NTG), a hosting services company. Venyu is now a wholly-owned independent subsidiary of Dallas-based PHNS, a provider of IT services for the healthcare sector.

CEO Scott Thompson was previously CEO of NTG.

Headquarters: Baton Rouge, LA.

8. Virsto Software

What they do: Founded in 2007, Virsto Software is the new kid on the block as far as this roundup is concerned. While most of these “emerging companies” are already out of the starting blocks and delivering product, Virsto is still in beta and waiting for the gun to sound. (G.A. is slated for next week.)

According to Virsto, most data storage technologies deployed with virtual servers were not designed specifically for server virtualization. Instead, the storage was designed based on assumptions that are true for physical servers but are false for a virtual data center. Virsto aims to tackle the challenges server virtualization brings to storage.

Virsto’s hypervisor-based VSX solution enables users to virtualize any workload, maximize consolidation of virtual machines, reduce storage management complexity and reduce storage costs.

Customers: Virsto has a number of beta customers, including Crutchfield, MaximumASP and a handful of hosting providers, universities and enterprises. General availability is scheduled for February 16.

Funding: $8.25M from August Capital and Canaan Partners.

Mark Davis, co-founder and CEO, was most recently CEO of storage resource management vendor Creekpath Systems, where he engineered a successful acquisition by Opsware (now HP).

Headquarters: Sunnyvale, CA.

9. Xangati

What they do: Xangati “applies concepts from the Web 2.0 world like streaming, collaboration and user-generated content to help customers plan, monitor and manage their virtualized infrastructures.” Xangati’s “live, to-the-second views” into the communication activity of any networked device on an organization’s IT infrastructure help IT spot problems in real time, letting them “zoom in” on the specifics to identify abnormal patterns and speed up remediation.

Customers: Xangati claims over 80 customers, including MemorialCare Health System, Nike, a top-five U.S. law firm, and several federal government agencies.

Funding: $18 million from Alloy Ventures and Walden International.

Alan Robin, CEO, was previously President and CEO of WAN-optimization company netVmg, which was acquired by Internap.

Headquarters: Cupertino, CA

10. Zenoss

What they do: Zenoss provides monitoring software for physical, virtualized, and cloud-based IT infrastructure. Zenoss monitors “up and down the infrastructure stack from servers to network devices and applications across physical and virtual realms – all with one product and a single interface.”

Zenoss has two primary offerings. Their flagship, Zenoss Core, is a free, open-source IT operations monitoring product. Zenoss Enterprise is a subscription-based product that extends the Zenoss Core with “features required by highly-virtualized enterprises,” such as enterprise device monitoring, app monitoring, “deep” Windows and VMware monitoring, role-based security and more.

Customers: Customers for Zenoss Enterprise include Rackspace Hosting, VMware,, Agilent Technologies, Real Networks, Carlson, Verizon, U.S. Army, U.S. Air Force, LinkedIn, Motorola, iStock International and Deutsche Bank.

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

Bill Karpovich, CEO and co-founder, previously held leadership positions with several IT startups including USinternetworking and Digex.

Headquarters: Annapolis, MD

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