Cloud technologies are impossible to envision without VMware. The company is a leader of the Gartner’s Magic Quadrant, ranks among the top 50 organizations committed to clean energy, and was long recognized as one of the most responsible employers (up to its purchase by Broadcom). Around 80% of all virtualized workloads are based on its technologies, and it has become one of the key Broadcom divisions.
Here’s the story of how the founders were building a supercomputer, but ended up creating one of the most influential tech giants of today.
From crack house to national park
In the north of Silicon Valley lies Palo Alto, home to the headquarters of the world’s most renowned tech companies: HP, Apple, Google, Facebook, Logitech, PayPal, etc. It is here, alongside the offices of SAP Labs and Tesla, that VMware’s buildings take up a vast territory. It features a park with a thousand trees, a pond with ducks and turtles, a fountain, a soccer field, and two fitness centers, and the whole concept is in line with the “green” architecture. However, its start was much humbler.
In 1997, three Stanford University students were working on the concept of a supercomputer with their professor. During the process, they decided to take an unpopular at the time solution from the 1970s, a hypervisor prototype, and enhance it with modern technologies. The project was called Disco — a nod to the music genre from the ’70s, which was also making a comeback at the time. The goal was to run different operating systems on one computer. 13,000 lines of code later — and they succeeded with IRIX OS on SGI Origin server computers.
In 1998, two of these students, Edouard Bugnion and Scott Devine, along with their professor Mendel Rosenblum, his wife Diane Greene, and a mutual friend from Berkeley, Edward Wang, founded VMware. They rented a 45 m² office in Palo Alto above a cheese shop, and their first weeks were spent trying to run Windows 95 on a Linux workstation.
VM stands for Virtual Machines, while “ware” denotes “products”. This succinctly describes the company’s work — creating software for virtualization.
As the team expanded and rented a new space (which Scott Devine once called a “crack house” due to the poor condition of the building), the company started releasing the first major products. VMware 1.0 allowed Linux desktop users to create virtual machines running DOS, Windows, and Linux. The beta version of the product was downloaded over 100,000 times in two months. Later, users knew it by a different name — VMware Workstation.
The company patented its developments. The first patent, US6397242B1, was registered on May 28, 2002, titled “System and Method for Virtualizing Computer Systems”. Since then, VMware has been granted over 1,800 patents.
With many companies depending on it, VMware can boast a vast partner program (which is now a part of the Broadcom Advantage Partner Program). GigaCloud is, by the way, included in it as a VMware Cloud Service Provider Premier Partner.
Core values
VMware’s corporate culture is summed up by the acronym EPIC2:
- Execution
- Passion
- Integrity
- Customers
- Community
To ensure employee comfort, VMware operates over 100 office spaces worldwide, which can be visited during business trips, but remote work is also an option.
Interesting benefits include a $12,000 adoption or surrogacy assistance, partial coverage for nanny or elderly care services, $2 million in life insurance for employees (with coverage for partners, children, and pets), free family psychotherapy, and business coaching.
Rise and Fall
VMware’s solutions allowed many organizations to use their IT resources more efficiently, and demand for the company’s products skyrocketed. The company also gave a major boost to cloud technologies.
In 2004, EMC Corporation acquired VMware for $635 million, focusing on cloud computing solutions. At the time, EMC specialized in data storage, and VMware’s virtualization solutions allowed it to expand into public and private cloud offerings.
However, in 2007, they made a mistake. EMC’s CEO Joseph M. Tucci announced the dismissal of VMware CEO Diane Greene, offering the position to her husband, Mendel Rosenblum. He refused and soon left the company as well, returning to teaching at Stanford. After this news, the company’s stock fell by 24%.
Cloud popularity reborn
In 2016, EMC was acquired by Dell Technologies, and VMware became part of Dell as well. This allowed VMware to further popularize its solutions, as they were done through Dell’s sales channels — for instance, in 2021, 35% of VMware’s revenue was attributed to them. According to a five-year agreement signed that very year, Dell handled the sales of VMware’s product portfolio and cooperated in promoting servers designed specifically for its virtualization programs, cloud solutions based on Dell hardware and so on.
What’s next?
In Autumn 2023, VMware company was acquired by Broadcom in what was later dubbed as one of the largest IT-deals in history. 3,000 laid off employees later, radical VMware changes were introduced to this behemoth in the world of virtualization.
Broadcom started reorganizing VMware, shifting its work areas into four divisions within the corporation: VMware Cloud Foundation (VCF), Tanzu (TNZ), Software-Defined Edge (SDE), Application Networking and Security (ANS). The enterprise still is dedicated to private, hybrid, and multi-cloud environments, but for users almost everything they got used to has changed.
Read more about it here.
