Red and orange blinking mean it's in bootloader mode. That is, it received the command to enter bootloader mode, but didn't receive the commands to complete the update, probably because it's not being forwarded into the VM where
tessel update is running.
While the LEDs are blinking, does it show up in the guest VM? (
lsusb and look for
1d50:6097) Does it show up in the VirtualBox USB forwarding menu and is it marked as forwarded?
The rules VirtualBox sets if you create a filter from an existing device include filters on the Revision and Product fields, which are different between the different modes. So if you accepted those defaults, try blanking out those fields.