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How to turn one server into many servers? (Virtualization/VMWare)

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http://serverfault.com – I'm hoping for a high level discussion of this problem I know is quickly approaching my application. I have a server that binds on a specific port and manages TCP Sockets from my clients. I know that it is common practice to use VMWare to virtualize servers and run multiple servers at once. How can a single server design be changed to support multiple servers? Multiple servers can't bind to the same port. If I had to guess I would say a proxy server binds to the port and then sends connections off to the other servers to be handled as if it was still a single server application. I'm wonder (HowTos)