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WeWork is opening a second headquarters — in San Francisco

Don’t call it a real estate company, it’s a tech company. WeWork will open an office in Salesforce Tower and will hire around 100 engineers.

WeWork’s logo on its glass front door, showing an office behind it Theo Wargo/Getty Images for iHeartMedia

The knock on WeWork, the $20 billion startup that offers sleek communal office space, has long been that it isn’t a true tech company, critics say. It’s a real estate company.

In a move that will serve as a counterpoint to that perception, the New York-based WeWork on Thursday said it would open a second headquarters in an iconic building in the heart of tech-land — in San Francisco’s new Salesforce Tower.

The company is imagining the new headquarters as not just a warm room for about 250 employees, but as a foothold in the tech community.

WeWork will lease the 36th, 37th and 38th floors of the 61-story tower, which is set to become the tallest building in San Francisco when it opens early next year. Some of the space, of course, will also be subleased as WeWork spaces to customers.

Fresh off of a monster $4 billion cash injection from the Japanese conglomerate SoftBank, WeWork in recent weeks has been on an office acquisition spree, using its cash to buy another historic building, the Lord & Taylor flagship store on Fifth Avenue in Manhattan, for its East Coast headquarters. That deal set back WeWork $850 million.

Much of the West Coast push is centered around WeWork’s new chief product officer, Shiva Rajaraman, whom the company poached from Apple this summer to build out WeWork’s tech stack.

The second HQ is also a sign of the company’s expansion plans. Rajaraman is hiring as many as 100 engineers who can be more easily pulled from tech giants if WeWork has a local headquarters — rather than asking a well-paid developer or designer to move to Manhattan.

Much of the motivation for the new HQ, Rajaraman told Recode, is to help with recruiting — he envisions it as a “great touring space.”

“It will be a great angle to expose the fact that we’re not just bricks. We’re also pixels,” he said. “How do we use technology to allocate space? Price space? Optimize space? ... And then, of course, potentially broker that space between different owners in unique ways that are only possible because we exist?”

WeWork has been under scrunity from some investors who argue the company doesn’t deserve its sky-high valuation since its service — partitioning and selling office space — doesn’t have a pure technical breakthrough behind it. Even so, many of its early customers were small startups looking for modest spaces without longterm contracts.

WeWork’s expansion to San Francisco will also bring it closer to large enterprise clients who could claim some of the at least 750 total desks that will be on their floors in the Salesforce Tower. More than 20 percent of WeWork’s business now comes from companies with more than 1,000 employees.


This article originally appeared on Recode.net.

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