Revenue! Profit is not irrelevant, of course, but if a company is profitable, it simply means the multiplier increases. And many small tech companies get acquired when they're intentionally not profitable, because they're working towards growth rather than profitability.

I'm not quite sure what you mean by your second comment, but to be clear, they *lost* $17M net of their $3.4M - so their gross expenses were $20m. As far as paying someone to take it, if there's really no takers for buying the company, and no more money, they'll close things up and try to sell the intellectual property.

tftp is totally correct, and if I had to guess, in this case it was:

- no more water to draw from the well - i.e. with $70m raised and $3.5m in revenue, who's gonna put in more money?

- they knew that there was still a little mojo left in the virtualization market - but the reality is that once the dust settles, you're gonna have a small number of players - VMWare for sure, maybe MSFT, maybe citrix, maybe Oracle - anyone else who's making a virtualization platform has already been bought or isn't going to be, so this was their chance to get out.

Heh. Well, so, that's not exactly how it works. They had raised something around $60-70m in three or four rounds, including one round that involved firing/departures of most of the original founders, a new management team, and a totally new business focus.

So first of all, every time you do a round of fundraising, you create new shares of stock. Let's say my company has 100 shares of stock, and you're a 10% owner of stock - that means you own 10 shares of stock. When we want to raise money, we go convince an investor that our company is worth $100,000, or $1000 per share, making your shares worth $10k. We then have the investor give us $100,000, we create 100 new shares of stock, making the company worth $200k "post-money" - but now you only own 5%, and your investors own 50%. On top of that, the investors might say, "hey, we want liquidation preference, or participating preferred" - complex subjects that can't be delved into here, but suffice it to say that gives them more power.

Ok, time goes by - you spend that $100k you've raised, and while business is not terrible, it's not as good as your investors had hoped. You go back to get more money, and they say, "Sure, we'll give you another $100k, but we really don't think the company has progressed like we'd hoped, so the total company is worth $150k pre-money" - whoops, now your shares are worth $7,500. And after another 133 shares are created, you now own around 3% of the company.

See how fast individual ownership can drop? Now, let's extend this factor to someone like VirtualIron who was raising $10-25m *every time* they raised money, and changed business models once. You can bet that by the time they went through four rounds of funding, the VCs owned almost all of that company. (By the way, I realize that this is only the most simplistic model of how companies fund operations through VCs, so don't yell at me - I don't have the space to talk about every option).

According to some papers that had been leaked to the nytimes, in 2008 they did $3.4m in revenue and lost something like $17m on that $3.4m. How much can that company be worth? Typical rule of thumb in tech stock transactions is 5x-12x revenue, depending on a variety of factors. Given that it cost them $17m to make $3.4m - one could see how the multiplier is not gonna be so favorable. Let's make it 6x - that's $20m.

So, you have a company where investors have sunk and lost $60m, fired management at least once, changed business models once, changed products at least once, and in the end, they're getting bought for between $16-32m. Do you think that anyone got more than a "thanks for selling this dog of a company" bonus?

It's a shame, and I feel bad for the employees, but this is not a tech success story.

By your own example, though, clearly the current level of diversity hasn't helped mitigate the spread of malware, since conficker was able to install on many many PCs.

Then, if we decided we needed more diversity, how many more? I can't see having 10 major OSes making a difference, perhaps 50 with wide distribution.

So now, businesses, software developers, hardware manufacturers, tech support organizations have to support 50 different operating systems? Where's the ROI on that? How will we hire enough people who are trained on that many different configurations?

Certainly, we all want better computer security, but improving security by increasing IT complexity is like permanently banning travel between countries because of the fear someone might bring a disease in. It solves the problem, but damages everyone every other way.

Mostly, it just benefits Intel and AMD. Sun loses their high-end chip, which theoretically hurts their high-end offerings, but their high-end servers are an rapidly declining piece of their revenue. I've thought that Sun should drop SPARC entirely, except for supporting legacy customers. The niagara chip is an interesting concept, but most people today just want Intel/AMD chips in their servers.

Ah, it totally depends on the type of database cluster. For example, with Oracle, if you're using Oracle DataGuard, even in synchronous replication mode you can define an "apply delay" - basically, "Don't acknowledge this commit until it is written locally, and copied and acknowledged on the remote side, but don't actually apply the transaction for two hours"

That way, if someone does a delete * from blogs;, it will be reflected immediately on the production, but you've got a nice window to sort it out.

Plus, if you've got database flashback turned on, you can simply say, "Flash my database back to what it looked like before someone was an idiot", and all your data comes back.

These features are expensive in Oracle, but they can be very useful when you actually need them.

Well, this might work, but at many many airports, when the TSA checks your ID against your boarding pass, they mark the BP by signing it or putting a number on the pass. I suppose you could duplicate the signature, but I've seen passengers who didn't have the signature on their BP be detained until a TSA person can come and wand them.

Matt