Austin-based connectivity virtualization developer NextIO announced Friday that it had raised $ 18.8 million in a third round series as the five-year-old company prepares to launch its first products to enable distributed computing systems to connect and communicate using any of a variety of technology standards.

The deal was led by Crescendo Ventures and Adams Capital Management, and included previous investors JK&B Capital, the VentureTech Alliance arm of Taiwan Semiconductor Manufacturing Corp., and Dell, as well as two new strategic investors. The new funding brings total equity investment in NextIO to about $ 40 million and will allow the company to launch its first commercial products with original equipment manufacturers (OEM) partners in the second quarter of this year.

NextIO co-founder and CEO K.C. Murphy said the company made its first switch products available to customers in late 2007 but will launch its primary appliance product in April, in conjunction with new products introduced by OEM partners. The products are aimed at bringing the same advantages of virtualization to connectivity technology that developers including VMWare, Microsoft and the open source Xensource platform have brought to the server market.

NextIO’s product virtualizes I/O functions to bring high-performance computing capabilities to clustered systems of commodity servers. The products enable individual server connectivity using any of the several available connectivity standards with systems level technology that controls connectivity within a virtual “cloud.”

[Source: TechConfidential]