Back in 1999 John Percival and James Limm were running a forum community using Infopop's UBB.classic software. As their web site grew larger, they noticed that their UBB/classic could not always handle the number of online users they had.
Searching for a better solution, John Percival decided that it would be better to write their own software. Initially, it was designed solely as a rewrite of UBB, but using PHP and the database MySQL. Even though they wrote this software for only themselves, other UBB owners expressed interest in their solution. John Percival and James Linn offered to sell their code to Infopop, but were rejected. Limm and Percival instead created Jelsoft and released their work as a 'for sale' script, which became vBulletin 1.
After several minor releases of their software, the two decided to start working on a new version that would be more than just a rewrite of UBB: Rewriting the product from top to bottom, vBulletin 2 development began. The eventual release of vBulletin 2 proved to be very successful and made vBulletin Forum Software popular.
vBulletin is arguably the best forum software on the market today.
In July of 2007 Jelsoft was aquired by Internet Brands, Inc., a leading provider of automotive, travel and home-related sites and communities.
A few interesting tidbits:
The name Jelsoft comes from the initials of James E. Limm and software. Percival apparently didn't get mentioned.
The developers refer to the server where development takes place as the "Ninja Development Server."
The "v" in vBulletin does not actually stand for anything.