According to a poll by the newly formed San Francisco Citizens Initiative for Technology & Innovation (sf.citi), their 125 member companies are expecting to hire “like 8,000 new jobs this year and counting,” according to Ron Conway, sf.citi’s founding Chairman.
Tech companies hiring 8,000-plus in San Francisco [Business Times]

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Comments from “Plugged-In” Readers

  1. Posted by johnny

    can you say BUBBLE?
    can you say 30x SALES? hey, isn’t that what Sun Microsystems traded at back in the day?

  2. Posted by [anon.ed]

    ^What do you mean by that?

  3. Posted by johnny

    I MEAN PREPARE FOR THE INEVITABLE CORRECTION.
    BECAUSE IT IS COMING AND WILL SHRED THESE INSANE “VALUATIONS” IN THESE “TECHSTERS”

  4. Posted by kg

    Most cities would embrace a strong industry right now. No. In SF, we must complain and long for its failure.

  5. Posted by sparky-b

    So you don’t think that list of 125 companies could possibly hire 8K people this year.

  6. Posted by lol

    The tech bubble was built on expectations. This tech boom is built on actual financial results.
    But it was built on the back of the tech bubble. Most importantly: all the valuable educated people who came here in the late 90s and early 00s and kept going even after the dot-com crash. They’re mature, realistic, and especially still have their spark and spirit.

  7. Posted by Big V

    Another thing that folks keep missing — with all these tech companies having IPO’s, many folks are focused on how many new millionaires are going to be made and looking to buy houses in SF, but that is only a small part of the story. Companies raise lots of $$ with IPO’s based on expansion plans. More significant than the new millionaires are all the new Hires that the companies make. (and these are well paid engineers, who can afford nice houses).
    And of course, besides new millionaires, there are also many many more folks who end up with the $2-300K downpayment on a nice house (combined with ongoing solid tech wages).
    the future looks bright, and this bull market is only just getting started….

  8. Posted by johnny

    @lol
    NOPE. FB at 30x sales = BUBBLE
    NO different than CSCO at 600 Billion Valuation in 99/00 = BUBBLE
    But, hey, where there is overvaluation there is opportunity.

  9. Posted by shza

    these are well paid engineers, who can afford nice houses
    I wish people would quit with this canard. Unless you have a ton of accumulated wealth already, a $100k or even 200k salary does not afford a “nice house” in SF, or even close — as much as people here like to pretend it’s reasonable/feasible to take out loans that are 5-10x HHI.
    (Also, agreed that there is serious overvaluation at play here, though there will be some winners.)

  10. Posted by DanRH

    @shza. Obviously ‘nice’ can mean a lot of things but I can disagree. Friends of mine – married/each spouse bringing in 100-200k each – make it work fine. May not have a house in PH, Noe, or Cole, but do have fine houses/etc.
    What’s more important I think: new engineers coming into SF for this ‘boom/cycle/whatever’, while not having the $ to own a place now, may save up and have that in the future. And if jobs stay in the bay area, which they have, then it’s likely they stay too.

  11. Posted by lol

    And GOOG at time of IPO was around 100. Not for long though.
    It had the same premises: an already profitable business still growing its income on the back of a service everyone was using. Facebook has 800M+ users plus knows who they actually are for the most part which is extremely valuable for marketing, as opposed to Google who didn’t have the same quality in individual granularity and was working off search and click results. Of course GOOG has evolved now, but FB has a head start on the built identifiable customer base.

  12. Posted by lol

    ^^^ That was a response to Johnny

  13. Posted by Wai Yip Tung

    8,000 sounds like a realistic number. My bet is tech companies have already added this many in 2011.

  14. Posted by Big V

    @shza
    you are wrong — plenty of folks can buy nice houses on a $1-200K income. As DanRH says, it all depends on where you want to live. Most young techy’s wouldn’t want to live somewhere energetically dead and boring like Noe, PH, or the other “prime” parts of SF. Somewhere with spark, adventure, and creativity like the Mission is far more interesting, and currently at a price point that can be bought into on a tech salary.
    You can extrapolate from that about which parts of the city will benefit the most from this trend….

  15. Posted by sparky-b

    Perfect we can then create an alternate set of Plan A, Plan B, and Plan C nieghborhoods based on these new parameters.

  16. Posted by tipster

    This was an unscientific survey by a group with an agenda.
    8000 doesn’t seem unrealistic when you poll a membership of what is basically growing tech companies planning on staying in SF (which is what their membership is composed of), but it misses the companies that are struggling (in tech, there are usually lots of competitors, and then the market unites behind one or two of them, the others go belly up), or will move south or whatever.
    One large company can lay off or move to a lower cost area 8000 people in a weekend. So it doesn’t really say anything about the net results. Are some companies growing? Yes, all the time in every business climate. During the dot com bust, I doubled my headcount.
    And recognize that this unscientific survey was done to promote the group’s agenda. If I had been a member of that group, I might have easily inflated my hiring “plans” to give the group of which I am a member more political clout.
    So does this “survey” tell us much? Nope. Are some companies hiring? Always.

  17. Posted by johnny

    @lol:
    GOOG aint a fair comp. The market had not already discounted GOOG’s growth like it has w/FB.
    The private secondary trading markets were immature during GOOG’s entry to public.
    While the secondary trading markets are significantly more mature now to the extent that the “public market” has already discounted FB, etc.
    There is not the mystery to FB that there was w/GOOG when it was on the cusp of IPO.
    You know the secondary private market is mature when there are leading articles in the WSJ on private Retail investors wanting to acquire FB prior to its IPO.

  18. Posted by futurist

    Hmmmm. I’ve never heard anyone before today call Noe Valley “energetically dead and boring”. That’s a new one.
    How exactly can a neighborhood be energetic and still boring? Got me.
    Noe seems pretty cool to me. Just check out any morning on Church St. buzzing with walkers, runners, cyclists, the streetcar flying downtown, the farmers market on Saturday. You can walk to Valencia in 15 minutes.
    what’s the problem?

  19. Posted by lol

    As GOOG in 2005, FB is still expanding the ways through which it can monetize the huge heap of data on customers it collects each and every second. Sure there’s a bit of hype as there should be. This is a great story and it attracts all sorts of attention, but GOOG’s IPO had attention and a great story too and tons of naysayers.
    I am not too worried for big tech. When AAPL was at 20 we were hearing the same alarmist cries. Same thing at 50. Same thing at 100. Same thing at 400. And revenue followed (some will say preceded) the stock price, therefore there’s substance in these successes.
    Are these big tech part of a cycle? Heck yeah. Will they be the source of more offshoots? Probably. There are a lot of good 20-somethings in new tech companies who see 30-somethings who did very well. They’ll want to follow suit. SF will gain.

  20. Posted by NoeValleyJim

    To the 20-something hipster crowd Stroller Valley is too old and dull. It has always been this way, at least since the late 80′s. The cool kids live in SOMA or The Mission.
    Once people start making some money and want to settle down and have kids, they either move up the hill or to the suburbs.

  21. Posted by Brahma (incensed renter)

    johnny, I don’t know if I read it in the wsj, but what I do know is that almost every time I’ve read about secondmarket in the last two years, I’ve read within a few paragraphs if not the next sentence that pre-IPO shares of facebook are available and trading.
    I wouldn’t know first hand, of course, because I’m not “an accredited investor”. But I can read about it, like I did last month. Forget Facebook, the IPO market is dying:

    Right now, SecondMarket is holding weekly auctions on Facebook stock to meet the extreme demand for shares, says Silbert. The company’s public offering is seen by many as a test of the eye-popping $100 billion valuation the social network has reportedly reached on the private markets. But Silbert didn’t see a long term future for SecondMarket as a stepping stone to an IPO.

    “The IPO market is dying,” he said. “You see companies achieving robust valuations on the private market but being treated poorly when they go public.” (We’re looking at you, Groupon and Zynga.)

    I don’t agree that the IPO market is dying, even given what happened to the two firms named in the last sentence. Nor do I think the secondary private market is “mature”. But we’re getting there rapidly.

  22. Posted by lol

    NVJ, exactly. Once you have kids you’ll depend more on a car which makes NV a better bet, plus the people camping on your sidewalk start getting pretty annoying after a few brushes with them.

  23. Posted by johnny

    @Brahma:
    I agree w/you that the secondary private market is not “mature” in the general sense.
    My point was that the secondary market was “mature” compared to when GOOG IPO’d several years ago thus FB’s “pre IPO” valuation is much more transaparent v GOOG’s several years ago.

  24. Posted by johnny

    And many will get hurt by FB’s overvaluation.
    Any many will profit by its overvaluation.

  25. Posted by sparky-b

    There are 125 companies in sf.citi
    They are going to hire 8000 employees
    0 of the 125 is named Facebook.
    Yet 8 of the 24 posts is about FB.
    now that is “energetically dead and boring”

  26. Posted by anon

    Academy of Art College (yep, that’s one of the “tech companies” that is in this “really serious” group) will probably hire 600 people this year. And 600 will leave because of the poor wages and conditions. Anyone taking this puff piece seriously is a fool.

  27. Posted by johnny

    @sparky-b:
    pick another name then.
    FB is simply a reflection of the current frothiness.
    ZNGA is frothy too at over $10,000,000 per employee current valuation.
    CSCO was generating profit in 99/00 when it was $600 Billion+ in valuation … today and even MORE profitable than 99/00, CSCO clocks in at $107 Billion valuation
    Social Media is inflated. Social Media is what is driving SF tech for the most part
    Social Media will eventually crash as the sector becomes more diluted by competitors coming in for some of the pie.

  28. Posted by sparky-b

    Okay, I picK:
    Adobe
    Autodesk
    Expedia
    Snapfish and
    the YMCA.
    What is going on the the frothiness in these companies?

  29. Posted by johnny

    @sparky-b:
    you and I operate on different planets thus perceive things differently
    best of luck to you

  30. Posted by HC

    FB is an email company on steroid. People who spends most time there either do not have the resources or inclination to spend money. Time is what they spend there. That is why their RPU is less than half that of GOOG.
    And no, regardless of how much data FB has about me, if I am not inclined to spend money, no targeting can get to me. So this treasure troth of useless status updates and survey results and +1′s aren’t going to make FB much money.
    But hey, maybe this time it’s different!
    And when ZNGA moves its games out of FB, well, guess what then?

  31. Posted by NoeValleyJim

    You are probably right johnny, but in the meantime enjoy the ride.
    You only get one trip on this bus and it might be a 14 Mission, but you might as well make the best of it.

  32. Posted by Vancouverjones

    These numbers don’t seem quite right since tech company hiring should be a lagging indicator of an improving economy The tech industry usually produces a better “system x” that help a non-tech business make more money at producing y. The tech industry is not mature or varied enough to survive without serving as the neural net for expanding, innovating economic body. So, I’m afraid that this may be another case of irrational exuberance.
    On another note, I’m not sure if it’s a good idea to funnel all our best and brightest 20 and 30 year olds into the tech and financial industries. You tend to end up products like Mafia Wars, FB and derivative models while loosing out mag lev trains, distributed energy systems and biotech drug discovery platforms.

  33. Posted by sparky-b

    ^^^”biotech drug discovery platforms” lots of great young minds still go into medicine and biotech. I don’t think the internet is taking that.
    Johnny, I operate on planet Earth. What planet do you operate on?

  34. Posted by sf

    If Noe Valley is considered energetic because a train runs down the street and people walk around, then the Richmond (Clement/ Geary) must be one of the most energetic neighborhoods in the city!

  35. Posted by RO

    BUBBLE. And the tech staff lay-offs in San Francisco. Yes folks, this time the jobs are going down South. Whole tech departments and divisions are being outsourced this very month.
    The housing bubble is self evident. With an income of ~ $225,000 be prepared to see a bunch of way overpriced crap, unless you have a 50% down payment. For $1.2M, you can obtain an overpriced but comfortable place to live and be stuck with the property tax bill while your neighbor gloats under Prop. 13 protection so you get to foot the bill. Then the old-foogy-stogies can tell you “you’re young… you have time” while they squeeze every corpuscle from you.

  36. Posted by futurist

    Yes, sf we do have a “train”. Actually called a streetcar.
    And yes, we do walk a lot here. That’s among the many reasons why NV is a pretty awesome neighborhood.

  37. Posted by sf

    I prefer SF proper. But that’s just me (and most others).

  38. Posted by futurist

    Well, ok: fair enough.
    Care to elaborate on what is SF “proper”? Seriously, I’m interested.

  39. Posted by Rillion

    I wish Geary had a train, even if it was actually a streetcar.

  40. Posted by futurist

    Totally true. Of all the major corridors in SF lacking really good transit, it would be Geary Blvd.
    They should put a streetcar line down the entire middle running essentially out to the ocean.

  41. Posted by Rillion

    The big issue would be what to do with the line east of Van Ness. Ideally it would go underground about where Geary/O’farrell become one-way likely connecting with the underground between Powell & Montgomery. But don’t see that happening now that the stockton line is being built. Obviously there isn’t ever going to be the money to dig out that much of the city.

  42. Posted by 48yo hipster

    I’ze don’t know about the future, but in the meantime I just scored me $3000 in rent for a small (but nice) 2br in the mish. Last year it was $2600. And the year before $2300. Of those 8000 jobbers, I’m sure half will want to be in the mish or in SOMA (noe, not so much; and reflected by the fact that mission rents are catching up to stroller-land.) High tech hipsters-schmipsters….I say keep ‘em coming!

  43. Posted by NoeValleyJim

    MTA is trying to build a BRT line down Geary but keep getting held up by the NIMBYs.

  44. Posted by NoeValleyJim

    And Yelp prices at $15, above the $12-14 initially projected. Another $100M raised by a San Francisco tech company.
    I wonder what they are going to spend it on?
    And in six months, some of that $800M market cap will be liquid for employees.

  45. Posted by lol

    And Yelp is now over 24. Not that short-term valuation really matters. But expect a tipster doom-fest if it loses 5%, lol.

  46. Posted by tipster

    What?! I bought a bunch of it at 26!

  47. Posted by sf

    I live in the Inner Richmond, which is unquestionably SF proper.

  48. Posted by Rillion

    If only Tipster could tell us when he buys these stocks we would know exactly when to short them since Tipster has the uncanny ability to buy them at the exact second of their highest price. Of course he only tells of these purchases after the price has fallen which does us no good.

  49. Posted by johnny

    how many employees does YELP have?

  50. Posted by Brahma (incensed renter)

    From the Los Angeles Times’ David Lazarus, dateline today, Let’s review Yelp’s IPO, money ‘graph:

    The review site Yelp has gone public, and Wall Street likes what it sees. The company’s stock took off at the start of trading.

    But is Yelp a good investment? Let’s post a review…What should make people wary, though, is the little fact that Yelp has yet to earn a penny since its founding in 2004. Yup, it’s been up and running for eight years and hasn’t made any money.

    I don’t know about you, but that’s the kind of thing that gives me pause. I’m funny that way.

    Unlike Zynga, Facebook and LinkedIn. I’d bet that it’ll be at least 5% lower by years end.

  51. Posted by NoeValleyJim

    Hey tippy, what did you buy ZNGA at?

  52. Posted by eddy

    Good news Tipster! Yelp is above water for you at: 27.65! :)

  53. Posted by Rillion

    Sell! Sell!

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