Startup hopes to ride VMware and Microsoft to market

February 3, 2007

3 Min Read
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Startup InovaWave has clinched new funding to help it piggyback on the momentum of virtualization vendors with software it claims can boost the number of virtual machines running on a physical server.

Today, the Austin, Texas-based firm announced $2 million in Series A funding from Silverton Partners. (See InovaWave Secures $2M.) Terry Ferose, the vendor's founder and CEO, says the funds will be used to double the firm's headcount from 11 to 22 employees during 2007, largely in sales and marketing.

Back in November, InovaWave unveiled its DXtreme software, which is aimed at firms running Windows virtualization such as Microsoft Virtual Server. (See InovaWave Launches DXtreme.) A version targeted at users of VMware's ESX Server is also on the cards and will be launched sometime this quarter, Ferose says. (See VMware Eyes Enterprise, Microsoft and VMware Unveils Upgrade.)

Virtual machines are essentially pieces of software that let users run separate applications or even operating systems on the same physical server. InovaWave says DXtreme can increase the number of virtual machines from four to eight on a typical server.

Ferose told Byte and Switch that InovaWave's DXtreme has achieved this by creating an individual I/O channel for each virtual machine, which transfers data directly to Microsoft Virtual Server or to ESX Server. This process, according to Ferose, reduces the amount of memory needed by each virtual machine, enabling users to deploy more VMs on a single piece of hardware.The endgame here is cutting users' data center costs. "If you double the number of VMs on a physical server, you can reduce the capital expenditure, collocation, and labor costs associated with tons of servers," explains Ferose.

The exec says that InovaWave has managed to rack up eight customers for the Windows version of DXtreme, although only one of these, Austin-based software development firm NovusEdge, has been made public.

At least one analyst feels that demand for DXtreme will remain limited, at least for the near future. "What we're seeing is the first wave of virtualization adoption," says Laura DiDio, research fellow at the Yankee Group. She says InovaWave is entering the market at a time when users are struggling to separate virtualization hype from reality. Cost and lack of third-party support have also been cited as major challenges by VMware users. (See Users Talk Virtual Tension and Tales From the Virtual Crypt.)

That said, the analyst predicts that certain sectors will be looking for DXtreme-type functionality within the next two to three years. "Initially, the appeal is going to be for the high-end customers," she says, explaining that the technology is likely to find its way into medical imaging, engineering, and law firms.

InovaWave is not the only startup attempting to cash in on the rise of virtualization. Kidaro, for example, is also looking to exploit VMware and Microsoft products, although its efforts have so far been focused on the desktop space. (See Kidaro Secures $10 Million.)At a time when VCs appear to be throwing money at virtualization startups, it remains to be seen how long InovaWave's $2 million will last. (See Virtualization Startup Seals $12M , Egenera Lands More Funding, and Vamping Virtualization.) "We're definitely reviewing our financial plans on a quarterly basis," says Ferose, adding that the timing of another round will depend on user demand for InovaWave's product.

The exec won't say when, if ever, InovaWave will extend its product to other virtualization offerings such as XenSource. (See Xen & the Art of Virtualization and Virtual Iron Revises Platform.) "We are looking [and] we have a close eye on our product roadmap -- it's too soon to tell," he says.

James Rogers, Senior Editor Byte and Switch

  • InovaWave Inc.

  • Kidaro

  • Microsoft Corp. (Nasdaq: MSFT)

  • VMware Inc. (NYSE: VMW)

  • XenSource Inc.

  • Yankee Group Research Inc.

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