Its quite annoying that you can’t boot from a USB Drive in VMware. So here’s a simple workaround.
1. Download Plop Boot Manager at http://www.plop.at/en/bootmanager.html#download
2. Extract the .ZIP
3. Attach the .ISO from the extracted .ZIP to your VM that you want to USB boot.
4. Making sure the USB stick is inserted into your PC, and attached to the VM.
5. When the Plop Boot Manager comes up, select “USB”.