Embedded development is tricky, and anything that can help improve the productivity is useful.
The problem is that there have been many, many attempts at doing this exact same thing over the years. And they all have to fight the same fight: to get some serious traction for their particular approach.
Back in the 00's, Sentilla did a Java VM for the MSP430. This got a lot of traction - they even had James Gosling himself vouch for the project.
More recently, Electric Imp and Particle.io have taken similar approaches, but with other languages.
Micropython and a variety of mini-JS engines are also around. Espruino, Tessel.io, and many more.
In a technical sense, running a virtual machine on a microcontroller is a really good way to go. You remove a lot of low-level friction that you otherwise have to deal with. And you get a lot of things almost for free, such as Over-The-Air (OTA) updates, and more control over security.
But when you get down to actually doing the work, you frequently end up wanting to have all that low-level access, even if you have to endure a bit of pain. Sometimes you don't even want to have an operating system with a hardware abstraction layer. You kinda want the bare metal.
So Toit are in a tricky situation. They may have a really good product. But they will have to get some serious traction. Developing a rock solid programming language and virtual machine is hard. Really hard. But it is way easier than to get that sweet, sweet traction.