The problem is that after installation, on reboot it shows a blank screen. Just nothing... (except for the blinking cursor). This might be specific to VirtualBox guest machines but I can't verify this.
Anyway, it took me a while to figure this one out (of course with the help of Google). The following, from Ubuntu's bug repository Launchpad, shows the problem:
Ubuntu 11.10 Command line only installation fails over and over again
grub2 configuration has vt.handoff=7 even when X11 is not installed
Command-line Install on Minimal CD tries to boot graphically
Ubuntu minimal/alternate failed to cover the use case that user might not need GUI in Ubuntu. This is a big oversight as a big chunk of Linux users (servers) don't need GUI. What happens is that it boots up and creates virtual terminal session 7 so that it can transition to GUI login seamlessly.
The work around
In Ubuntu 11.10, /etc/grub.d/10_linux line 70, it checks if the word "splash" is present in GRUB_CMDLINE_LINUX_DEFAULT. This GRUB_CMDLINE_LINUX_DEFAULT can be modified in /etc/default/grub. So changing this line:
I should have removed "splash" only but I also would like to see all the message while the machine is booting up.
Next up, is add the following towards the end of /etc/default/grub:
Ok I am not so familiar with this one. But I believe what it does is to force it to run in text mode instead of doing KMS functionality built-in the kernel.
Now, to update grub.cfg run:
Then reboot the machine, like: