When it comes to the legions of Bay Area startups, Palantir Technologies may not be a household name, but after reading this, you're not likely to forget it. Described by the Mercury News as "secretive" and "tight-lipped," Palantir's name is a nod to a crystal ball in J.R.R. Tolkien's Lord of the Rings, and the company behind it is just as magical seeming: With a $20 billion valuation, it's America's third most valuable private company, behind only Uber and Airbnb, reports Reuters; its data analysis software is said to have helped track down Osama bin Laden; and it has counted the NSA, FBI, IRS, and CIA among its clients since 2004. It's also quietly taking over Palo Alto, California. The company, which employed 1,800 people in 2015, rents more than 250,000 square feet across nearly two dozen buildings in the downtown area, per PrivCo, which provides data on privately held companies.
That's roughly 12% of the commercial space available downtown, which has some worried that Palantir is crowding out other nascent startups, and others fretting about the potential for skyrocketing rents. The concerns aren't imagined ones, per figures cited by the Mercury News: Availability is at a seven-year low, and the cost of commercial space downtown is up to $102 per square foot; five years ago, it was $71. A January report from CNBC on the issue also noticed that these leases there are becoming "super long," as venture investor Jeff Clavier puts it, and prohibitively so for many start-ups at 10- to 15-year terms. Palo Alto "once had a vibrant start-up community and that's gone," he says. (Another startup yielded the tech world's "unluckiest guy.")