While creating the an Apple Virtualization VM, if you set a "Shared Folder" in "Sharing" tab, UTM fails to start with the following error message.

Error
An error occurred during installation. The virtual machine failed to start.

If you clear the "Shared Folder" list in VM settings, VM starts normally and installs the IPSW image.

After IPSW is installed, no problem adding folders to "Shared Folder" list. VM starts as expected.

Configuration

• UTM Version: 4.4.0 (88)
• macOS Version: 14.0 Beta (23A5337a)
• Mac Chip (Intel, M1, ...): M1