In a gravity-defying performance, VMware's initial public offering ignored a dropping stock market and rose from $29 to $51 by the close of its first day of trading, a gain of 76%.

The stock market as a whole took a drubbing. The Dow was down 207 points for the day, as renewed credit worries and a pessimistic report from Wal-Mart drove investors away.

But VMware's gain, with 38,238,000 shares changing hands, showed a huge appetite for a virtualization play in the computer industry.

"The market is showing it's finally realizing how valuable and disruptive VMware is," said Ashmeet Sidana, venture partner at Foundation Capital and a former director of VMware's ESX Server hypervisor product line. VMware's VMware Server, ESX Server, and Virtual Infrastructure 3 have made VMware the market leader in virtualization software, according to IDC.

VMware is owned by EMC, and EMC's sale of 10% of the company raised $957 million for future VMware expansion and development. Early trading in its 33 million share offering sent VMware share up as high as an 84% gain before falling back to the 76% gain and $51 figure.

Shares of the software unit of EMC were priced at $29 Monday, raising $957 million and coming in at the high end of the company's forecast range.

Sidana predicted that the virtualization software field "will become its own ecosystem," with Microsoft and VMware vying to lead in that space. Microsoft offers Virtual Server and has plans for a hypervisor, Veridian, as an offering with the upcoming Windows Longhorn Server.

Many additional virtualization startups will drive the ecosystem, with venture capital funding behind them, Sidana predicted.