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 The thinking, championed by Steve Jobs, was that a centralized
campus would put the CEO “within walking distance of everyone,” said
Steve Wozniak, who founded the company with Jobs.
That stance may finally be softening as Apple prepares to open chic
new offices in San Francisco’s high-rent South of Market
neighborhood, which has spawned scores of promising startups.
Apple's decision to plant a flag in San Francisco, 46 traffic-choked
miles north of its headquarters, comes years after similar moves
from rival tech firms such as Google and LinkedIn and marks a
turning point in Apple's willingness to accommodate workers,
according to recruiters and former employees.
The move is one sign of the intensifying war for tech talent – and
of the overwhelming preference of younger tech workers to live and
work in the city, with its vibrant nightlife and public
transportation. The two floors Apple has leased in a building mostly
occupied by CBS Interactive offer abundant open space and exposed
ceilings, the preferred tech aesthetic.
As Apple's Silicon Valley rivals dangled perks to woo workers in the
latest tech boom, the iPhone maker mostly held firm – the company
still does not offer free lunch, and it was among the last companies
to operate shuttles to and from the city.
Those company-paid charter buses to the valley appeased workers for
a time, but the novelty has faded, said recruiter Andy Price of
executive search firm SPMB.
With rising competition for talent from a new wave of private
companies with sky-high valuations – such as Uber and Airbnb – Apple
must do more, recruiters and former employees say.
“Apple’s attitude has always been that you have the privilege of
working for Apple, and if you don’t want to do it, there’s someone
around the corner who does,” said Matt MacInnis, a former Apple
employee who worked on the company’s education business and is now
CEO of Inkling, an enterprise technology company.
Now, MacInnis said, “they have to compete.”
Apple spokesman Colin Johnson declined to comment.
URBAN OUTPOST
Apple's footprint in San Francisco until now has come largely
through acquisitions of companies already based there, including
Beats Music and Topsy Labs, a social media analytics firm.
After Apple acquired Topsy in 2013, workers were surprised that the
company did not move those employees to the valley, a former Apple
employee said. Topsy’s space was large enough for about 75 workers,
but other Apple employees soon began dropping in to work from the
city, crowding the office.
The iPhone maker's new office will be in about 76,000 square feet of
rented space at 235 Second St.
Apple's presence in San Francisco will remain modest, especially
compared to rival Silicon Valley firms such as Google and LinkedIn.
The new office is big enough for about 500 workers.
Apple has said that it had more than 25,000 employees in the Santa
Clara Valley, where it is headquartered.
Apple could opt to move some employees already in San Francisco into
the new space, such as those from Topsy or Beats. The company has
advertised for a variety of jobs in the city for workers in machine
learning and big data – two of Topsy's specialties – and digital
music, Beats' domain.
The space is currently under construction, suggesting Apple might be
ready to move in late summer, real estate experts say.
Demand for desks there could be intense. After established tech
firms open up shop in San Francisco, they often have more workers
wanting space there than they can accommodate, said broker John
Lewerenz of real estate firm Cushman & Wakefield.
Google has struggled to keep workers from swarming its San Francisco
office, particularly on Fridays. The company quickly leases
additional floors in its main San Francisco building when they are
vacated by other tenants, Lewerenz said.
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COMMUTING AND RECRUITING
Apple's new San Francisco office appears to be “just a small
adaptation” to some tech workers' disdain for the commute of at
least 90 minutes to the South Bay, said former company executive
Jean-Louis Gassee.
But some former employees say an official Apple office of any size
in San Francisco was once unthinkable – even though the city is home
to 14 percent of its workforce, second only to San Jose, according
to a 2013 company report.
For a graphic showing where Apple employees live in the Bay Area,
see http://tmsnrt.rs/1QwR4ZY
Apple's stance on centralization turns off some job seekers, said
recruiter Amish Shah, founder of Millennium Search, who has run
across some candidates who rule out the company because of the
commute. Younger tech workers, he said, put a high premium on
quality of life.
San Francisco residents now have more options to dodge the commute
with a growing number of tech companies in the city, recruiters say.
"If companies want to stay competitive and have a shot at hiring the
best available talent, they're going to have to be flexible," said
Jose Benitez Cong, a former Apple recruiter who is now launching a
startup.
Before leaving Apple in 2009, MacInnis spent three hours a day
commuting from San Francisco to Apple headquarters. Now he uses
Inkling’s location in the city to his advantage, systematically
recruiting San Francisco residents tired of long commutes to the
valley.
Russ Heddleston, co-founder and CEO of document sharing company
DocSend, says he has also found an edge by planting his startup in
San Francisco. He previously commuted to the valley to work for
Facebook<FB.O>, a notable exception to the trend toward satellite
offices in San Francisco.
“They have the social clout to get people to commute,” he said. “But
if they weren’t as cool, could they afford to have their office in
San Jose and get talent to come in? It’s a real problem."
SUBURBAN SPRAWL
Another factor may be that the company has little room left to grow
in Cupertino: It occupies about 70 percent of the office space in
the city of about 60,000, said Angela Tsui, the city's economic
development manager.
The sheer size of Apple’s work force has prompted the company to
grab space in neighboring towns such as Sunnyvale and North San
Jose.
The diffuse office structure has dimmed the allure of commuting to
the South Bay, said one former employee, who requested anonymity to
protect professional relationships.
"The old appeal was if you were an engineer at the mother ship, you
could go to the cafeteria, and there's Steve Jobs ordering sushi,"
he said. "Those days are gone now."
In Wozniak’s view, spreading out the teams could infuse new
creativity into the company. In a recent interview, he recalled
being a lonely voice of dissent on the company’s philosophy of
centralization.
"I was the executive who always opposed that," he said. "I felt that
you should distribute your divisions… and let the teams think more
independently."
(Editing by Stephen R. Trousdale and Brian Thevenot)
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