VM6 SW to make virtualization practical for SBs

SAN FRANCISCO, US: Eric Courville is not only hoping that outsourced computing power will attract small businesses, he's betting on it.

Courville is the chief operating officer and co-founder of VM6 Software Inc. (www.vm6software.com), a Montreal, Quebec-based startup developing virtualization software.

Virtualization software allows a program to run on one or more computers at the same time, as though it were working on a single machine. It's useful for large corporations that may have thousands of computers and need to insure programs will keep running even if a single computer fails.

Large developers, such as Citrix and VMWare, have sold virtualization software to corporations with massive data processing requirements. Yet virtualization has yet to become practical for smaller companies.

"That's our solution, bringing all the flexibility and benefits that virtualization has to provide to customers who wouldn't have been able to afford it," Courville said.

The company was self-funded until recently, when RBC Venture Partners, the investment arm of the Royal Bank of Canada, and Bellevue, Washington-based Ignition Partners, came together to invest $4 million in the startup's Series A round, which is typically a company's first infusion venture funding.

The company, co-founded by Courville and CEO Claude Goudreault, announced the funding round this week.

The technology behind VM6 was developed while its early employees were working as virtualization consultants. As they worked on installing and optimizing large virtualization projects, they found that few small companies could afford to take advantage of the technology.

Most virtualization software is customized and requires a lot of maintenance, according to Courville. He compared the services of the large virtualization software developers to an F-1 racecar, which performs well, but doesn't have the utility to be practical for most everyday users. VM6, by comparison, is attempting to engineer a simpler, less expensive virtualization package.

"Were going where it's been hard for anyone to justify paying for VMware," Courville said. "Were not challenging them in the datacenter."

Bringing Ignition Partners in to syndicate the deal posed some minor problems, however. The venture firm would not commit to doing the deal without a syndication partner, according to Courville.

"They (Ignition) liked the story, but (had not invested in many companies in Canada)," he said. "Ignition wanted to see another VC to step in."

RBC Venture Partners has actively invested in startups for 10 years, typically making two or three investments each year of between $4 million and $8 million.