The VRA by default initializes the default embedded vPostgres database. All of the initial configuration data and the replication configuration data will be stored in the embedded database. Therefore, it is important that you plan the type of database before you configure replication for the VMs. This is because, if you were to reconfigure the VRMS component to use an external database then you will lose the existing replication configuration information. You will also need to reconfigure the replication on the VMs. Backup and restoration of an external database is easier because you will only have to back up the database files. If you were to plan a backup of the embedded database, then you have to back up the entire appliance.
To know which versions of SQL Server are supported, use the solution/database interoperability filter on the VMware product interoperability matrixes web portal.
The portal can be reached by going to the VMware compatibility guides...