The “second-most valuable private U.S. startup” Stripe could soon dethrone beleaguered Juul for the top spot, and if so, they’ll do it with their headquarters moved from 510 Townsend Street to the shores of South San Francisco.
Those us who do not consider “fintech” to be an actual word will often confuse Stripe with Square, so let’s get this straight: both are web-based payment processors for small business. Square is the one co-founded by Twitter mogul Jack Dorsey, and is publicly traded after its terrible IPO in 2015 has since recovered nicely and made many a techie rich. Stripe, on the other hand, has not IPO’d and as such, its $35 billion valuation has it considered the second most valuable private startup in the country. Both Square and Stripe are headquartered in San Francisco, but Stripe made some noise last month that they were thinking of leaving town because of the scarcity and skyrocketing cost of available office space. Today Stripe announced they’re making good on that threat, as the Chronicle reports that Stripe is moving its headquarters to South San Francisco.
Their new joint is at Oyster Point, currently a sort of biotech office park. Oh, I hear they have a very nice DoubleTree by Hilton Hotel down that way! But more importantly to Stripe, they also have no gross receipts or payroll taxes down that way. Stripe will move its whole 1,000-employee operation to a new waterfront headquarters where they’ll sit aside even more terribly named biotech companies Fluidigm, Theravance, and Stemcentrx.
While the price was not announced, the San Francisco Business Times ran the available numbers as they are wont to do. They note that Cytokinetics, another Oyster Point tenant with the same realtor, is paying $65.40 per square foot. So at that rate, Stripe’s 421,000 square foot property would come in at about $27.5 million. The Times also reports it’s a twelve-year lease, and that Stripe’s current San Francisco lease runs eight more years, but the company will complete the move to South San Francisco by 2021.
Of course the tech business sector is sounding alarm bells about how impossible it is for startups with infinite wealth to do business in San Francisco. “Unfortunately, Stripe choosing to leave town is not an anomaly,” said sf.citi spokesperson Alex Tourk, whom we cannot ever mention without linking to this. Tourk also told the Chronicle he hopes to “work together as a collective business community to fix the gross receipts tax once and for all and establish a fair and equitable tax system that we can all rely on.”
Yeah, about this tax thing: Stripe was one of the biggest techie complainy-pants about the 2018 “homeless tax” Prop. C, dropping about $500,000 to fight it, and bitching on Medium that it was an “ill-conceived half-measure.” Stripe will surely find a friendlier tax environment in South San Francisco.
Stripe will not become the biggest South San Francisco employer — that distinction still belongs to Genentech and their nearly 9,000 employees. But Stripe will become the biggest tech sector employer there, at least, until another San Francisco startup bolts for the cheaper rent and lower taxes of “the Industrial Tity.”
Image: Kilroy Oyster Point