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Embedded virtualization vendor obtains $16M funding

Jul 12, 2007 — by LinuxDevices Staff — from the LinuxDevices Archive — views

[Updated Jul. 17, 2007] — Embedded virtualization specialist VirtualLogix has announced series B funding of $16 million. New investors included Intel Capital and round leader Esprit Capital Partners, while existing investors Atlas Venture and Index Ventures also contributed.

VirtualLogix said it plans to use the funds to “accelerate the company's global growth strategy, and develop the next generation of VirtualLogix's real-time virtualization software solutions.”

VirtualLogix's flagship VLX product comprises a small scheduler and other nanokernel components designed to divvy up a computer system's resources — CPU, memory, and peripherals — between multiple operating system instances. The touted advantages of this are many, but in a nutshell are reduced bill-of-material costs, legacy OS/application reuse, software failure containment, and license segregation.

VirtualLogix's current product line-up includes:

  • VLX-DM (digital multimedia), which targets set-top boxes, and generated most of the company's revenues early on. It was recently bundled by TI with select DaVinci DSP and RISC/DSP development boards
  • VLX-NI (network infrastructure), recently updated to support unmodified guest OSes (including Linux) when run on hardware with Intel VT (virtualization technology)
  • VLX-MH (mobile handset) — recently used by Spanish phone vendor Vitelcom in a product touted as the first single-core phone to run Linux

In its first funding round, VirtualLogix (then “Jaluna”) raised $12M, making it France's fourth best-funded company in 2004. The company later relocated to Santa Clara, after hiring former Wind River executive Peter Richards as CEO.

Mini-interview with CEO Peter Richards

In an exclusive interview with LinuxDevices, CEO Peter Richards said VirtualLogix will not adopt a greater focus on network infrastructure, as a result of Intel's participation in the funding round. “Just the reverse. Our goal is to take virtualization technology across the whole embedded space, which we believe to be a multi-billion dollar opportunity.”

Richards continued, “Our initial market focus is on connected devices — networked devices — from the network switch on down to set-top boxes and mobile phones. But there is some commonality in embedded devices, and other markets such as industrial automation, defense, and aerospace have similar needs.”

VP of Marketing Mark Milligan joined in, “We are not announcing any new markets or products today, but the applicability is there.”

Milligan said he expected Intel Capital's participation to “expand our already close relationship with Intel, especially in network infrastructure and multicore.” However, he was quick to add, “We are also partners with ARM and TI and NXP. We have found such partnerships incredibly helpful for our go-to-market strategy. And, we expect that virtualization support in hardware will become an absolute requirement.”

Asked about potential competition in the embedded virtualization market from Wind River, which recently acquired FSMLabs's real-time para-virtualization technology and subsequently announced a strategic partnership with former FSMLabs customer Curtiss-Wright, Richards replied, “They bought FSMLabs for a specific reason, and our VLX layer can actually help them. We are looking at working with Wind River. We see them as a partner, not a competitor. I can't say any more than that.”

As for OK Labs, a startup that recently announced its open source nanokernel had been licensed to Toshiba for use in a widely distributed mobile phone, Richards said, “L4 is an open source environment specifically built for mobile handsets. We believe it doesn't address all of the security concerns that operators have. Whether it is commercially viable has yet to be seen.”

Another potential competitor is Sysgo, whose PikeOS includes a para-virtualization component capable of hosting Linux as a guest OS. Sysgo recently pledged to add support for AMD's AMD-V virtualization technology, with an eye toward expanding its customer base to include U.S. defense companies.

Of Sysgo, Richards said, “They are a very fine company, and we've had talks with them. But they are focused on industrial automation and aerospace, and almost exclusively on European geography.”

Finally, asked if desktop and server virtualization specialist VMware posed a competitive threat, Richards and Milligan both spoke at length. Richards acknowledged, “Yes, but there are barriers to entry [into the real-time/embedded virtualization market]. There are different chipset demands, a different go-to-market strategy, different derivatives. Power management is an issue that we solved — similar to VMware but differently.”

Milligan added, “VMWare is so much heavier, and unsuited to embedded use. It has all of these interactive management features aimed at IT server management. [Device vendors don't need that] with an end product, once its shipped. Although, there are some pretty cool upgrade and management features for devices in VLX, too.”

To wrap up the interview, we asked Richards if he foresaw an exit strategy for VirtualLogix, and if so, whether a public stock offering or an acquisition seemed most appropriate. He replied, “Funny, the board asked me the same thing, and you'd think I'd have an answer. You need to do a lot of the same things for either one — market share, revenue, and growth. As for an acquisition, there are a number of companies out there — the usual guys that acquire software companies. But we also need to look at IPO as well, because VirtualLogix is certainly a growth company. There's a bright future for the mobility of applications that it can generate.”

In a statement, Tom Bradley, of Esprit Capital Partners, said, “We believe that the company's focused strategy, its unique technology, and strong management team provide a robust foundation for its future success.”

In other news, VirtualLogix recently expanded Asian operations and announced graphical development tools.

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