This article was written by Phin Upham
Diane Greene founded VMWare in 1998 with her husband Mendel Rosenblum. The company’s first year was spent in “stealth mode,” meaning it operated as a very small company keeping only about 20 employees on its payroll. It used this time to focus on development, releasing the first VMware Workstation product in 1999.
By 2001, the company was ready to enter the server market. They supported 64-bit architecture by 2004, and after an acquisition the company went public. Its shares debuted at $29, closing the first day of trading with a high of $51.
Greene was fired from the board in a sudden move done in 2008. She was quickly replaced by Paul Maritz, who was previously an executive for Microsoft. VMWare also stated at the time, perhaps not coincidentally, that profits would be modest compared to 2007’s growth.
VMWare then began a collaboration with Cisco Systems to provide data centers to enterprise operations. It also manages an Open Source platform-as-a-service it calls Cloud Foundry.
VMWare’s core product is what is known as a “hypervisor,” or more commonly as a “virtual machine monitor.” A virtual machine allows one user to essentially tap into the computer of another user, which is useful for a variety of applications. It enables employees to work effectively from home. It helps tech support people repair customer computers remotely, in addition to a host of other applications. VMWare essentially uses the host machine to power the transmission of data over an Internet connection.
About the Author: Phin Upham is an investor at a family office/hedgefund, where he focuses on special situation illiquid investing. Before this position, Phin Upham was working at Morgan Stanley in the Media & Technology group. You may contact Phin on his LinkedIn page.