VA Linux: The Linux Company That Once Ruled NASDAQ

This is our first article in the Linux and open source history series. We will be covering more trivia, anecdotes and other nostalgic events from the past.

At its time, VA Linux was indeed a crusade to free the world from Microsoft’s domination.

On a historical incident in December 1999, the shares of a private firm skyrocketed from just $30 to a whopping $239 within just a day of its IPO! It was a record-breaking development that day.

The company was VA Linux, a firm with only 200 employees that was based on the idea of deploying Intel Hardware with Linux and FOSS, had begun a fantastic journey on the likes of Sun and Dell.

It traded with a symbol LNUX and gained around 700 percent on its first day of trading. But hardly one year later, the LNUX stocks were selling below $9 per share.

How come a successful Linux based company become a subsidiary of Gamestop, a gaming company?

Let us look back into the highs and lows of this record-breaking Linux corporation by knowing their history in brief.

How did it all actually begin?

In the year 1993, a graduate student at Stanford University wanted to own a powerful workstation but could not afford to buy expensive Sun Workstations, which used to be sold at extremely high prices of $7,000 per system at that time.

So, he decided to do build one on his own (DIY FTW!). Using an Intel 486-chip running at just 33 megahertz, he installed Linux and finally had a machine that was twice as fast as Sun’s but at a much lower price tag: $2,000.

That student was none other than VA Research founder Larry Augustin, whose idea was loved by many at that exciting time in the Stanford campus. People started buying machines with similar configurations from him and his friend and co-founder, James Vera. This is how VA Research was formed.

VA Linux founder, Larry Augustin

Once software goes into the GPL, you can’t take it back. People can stop contributing, but the code that exists, people can continue to develop on it.

Without a doubt, a futuristic quote from VA Linux founder, Larry Augustin, 10 years ago | Read the whole interview here

Some screenshots of their web domains from the early days

 Linux Powered Machines on sale on varesearch.com | July 15, 1997
Linux Powered Machines on sale on varesearch.com | July 15, 1997
 varesearch.com reveals emerging growth | February 16, 1998
varesearch.com reveals emerging growth | February 16, 1998
On June 26, 2001, they transitioned from hardware to software | valinux.com as on June 22, 2001
On June 26, 2001, they transitioned from hardware to software | valinux.com as on June 22, 2001

The spectacular rise and the devastating fall of VA Linux

VA Research had a big year in 1999 and perhaps it was the biggest for them as they acquired many growing companies and competitors at that time, along with starting many innovative initiatives. The next year in 2000, they created a subsidiary in Japan named VA Linux Systems Japan K.K. They were at their peak that year.

After they transitioned completely from hardware to software, stock prices started to fall drastically since 2002. It all happened because of slower-than-expected sales growth from new customers in the dot-com sector. In the later years they sold off a few brands and top employees also resigned in 2010.

Gamestop finally acquired Geeknet Inc. (the new name of VA Linux) for $140 million on June 2, 2015.

In case you’re curious for a detailed chronicle, I have separately created this timeline, highlighting events year-wise.

VA Linux Stock fall
Image Credit: Wikipedia

What happened to VA Linux afterward?

Geeknet owned by Gamestop is now an online retailer for the global geek community as ThinkGeek.

SourceForge and Slashdot were what still kept them linked with Linux and Open Source until Dice Holdings acquired Slashdot, SourceForge, and Freecode.

An article from 2016 sadly quotes in its final paragraph:

“Being acquired by a company that caters to gamers and does not have anything in particular to do with open source software may be a lackluster ending for what was once a spectacularly valuable Linux business.”

Did we note Linux and Gamers? Does Linux really not have anything to do with Gaming? Are these two terms really so far apart? What about Gaming on Linux? What about Open Source Games?

How could have the stalwarts from VA Linux with years and years of experience in the Linux arena contributed to the Linux Gaming community? What could have happened had Valve (who are currently so dedicated towards Linux Gaming) acquired VA Linux instead of Gamestop? Can we ponder?

The seeds of ideas that were planted by VA Research will continue to inspire the Linux and FOSS community because of its significant contributions in the world of Open Source. At It’s FOSS, our heartfelt salute goes out to those noble ideas!

Want to feel the nostalgia? Use the timeline dates with the Way Back Machine to check out previously owned VA domains like valinux.com or varesearch.com in the past three decades! You can even check linux.com that was once owned by VA Linux Systems.

But wait, are we really done here? What happened to the subsidiary named VA Linux Systems Japan K.K.? Well, it’s a different story there and still going strong with the original ideologies of VA Linux!

VA Linux Team at a conference
VA Linux booth circa 2000 | Image Credit: Storem

VA Linux Subsidiary Still Operational in Japan!

VA Linux is still operational through its Japanese subsidiary. It provides the following services:

  • Failure Analysis and Support Services: VA Quest
  • Entrusted Development Service
  • Consulting Service

VA Quest, in particular, continues its services as a failure-analysis solution for tracking down and dealing with kernel bugs which might be getting in its customers’ way since 2005. Tetsuro Yogo took over as the New President and CEO on April 3, 2017. Check out their timeline here! They are also on GitHub!

You can also read about a recent development reported on August 2 last year, on this translated version of a Japanese IT news page. It’s an update about VA Linux providing technical support service of “Kubernetes” container management software in Japan.

Its good to know that their 18-year-old subsidiary is still doing well in Japan and the name of VA Linux continues to flourish there even today!

What are your views? Do you want to share anything on VA Linux? Please let us know in the comments section below.

I hope you liked this first article in the Linux history series. If you know such interesting facts from the past that you would like us to cover here, please let us know.

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