Flush with their latest $10 billion fundraising round, the cloud-based AI platform firm Databricks recently signed a 150,000 square-foot lease at One Sansome, and is now committing to keeping their annual conference in SF for five more years.

News bubbled up last week that the cloud-based AI firm Databricks was on the verge of signing a 150,000 square-foot lease at One Sansome for a new downtown SF headquarters, a fairly big expansion over its current 160 Spear Street HQ with a 120,000 square-foot size (and that HQ had grown several times over the years). And why not, Databricks scored $10 billion in VC funding in late December, for a $62 billion valuation to compete with their AI analytics rivals Snowflake and Palantir.    

Then on Thursday, the Chronicle had the news that Databricks was “investing more than $1 billion” into San Francisco over the coming three years. This investment is in the form of the big new One Sansome lease, and a five-year extension of their contract to hold their annual Data + AI Summit here in SF for the next five years. (This year’s iteration will be June 9-12 at the Moscone Center.)  

The Chronicle bills this report as an “Exclusive,” but Databricks had released this information in a press release that went out a good four hours before the Chronicle published their report. Moreover, rumors about the One Sansome HQ had been swirling for weeks; the SF Standard reported on February 18 that the firm would be taking over some big new HQ somewhere in SF, the SF Business Times confirmed it would be One Sansome on February 27.

But today’s Chronicle report does have some pretty juicy exclusive information about behind-the-scenes drama, in that Databricks was ready to pull the Data + AI Summit out of San Francisco and move the whole thing to Las Vegas.

“We wanted to be here long-term. But, honestly, in 2022 and 2023, as we were looking far out — because these commitments happen years ahead of time — we questioned whether we could continue to scale this conference in San Francisco,” Databricks co-founder and VP of Engineering Patrick Wendell told the Chronicle. “When you get to 30,000, 40,000 and 50,000 people, there needs to be a strong partnership between the city and the private sector for things like security, cleanliness and getting working with the hotels in the city. It’s a lot.”

This June’s Data + AI Summit is expected to draw 20,000 attendees, though according to today’s Databricks press release, that’s expected to “expand to nearly 50,000 by 2030,” which is the final year of this commitment. For comparison, Dreamforce drew 45,000 attendees this year, though in its peak pre-pandemic days would draw 170,000 attendees.

The Chronicle also got Mayor Daniel Lurie’s side of the story on almost losing the Data + AI Summit.

“I learned that they were considering another city for their conference, and said: ‘No, no, no. Please give us a shot,” Lurie told the Chronicle. He said he told city officials, "If we all work together, we can get the job done. We can absolutely host an incredibly important conference like Databricks, and do other things.”

The details of whatever likely sweetheart deal happened are not disclosed. But this is the kind of sweetheart deal where both sides probably got something lucrative, so credit where it’s due to Lurie’s deal-making.

But looking at the bigger picture, we are very hastily crowning artificial intelligence as the great savior of the economy and society itself, despite this technology being highly unproven and prone to absolutely gob-smacking errors. There is a possibility the technology is being wildly oversold, as we saw with “metaverses,” NFTs, and those stupid curved TV sets from ten years ago that no one actually wanted. Remember, sometimes the investor class gets proven completely full of shit!

And it's worth pointing out that despite their $62 billion valuation, Databricks is still completely not profitable, having lost $400 billion in 2024. They may not be the ideal white knight here.

But the AI boom is certainly arriving at the right time in San Francisco, giving downtown a jolt when it’s badly needed. We’ve seen boom-and-bust cycles before, and there are definite advantages to the “boom” phase. This Databricks announcement is encouraging news that SF may be entering another boom phase.

Related: Elon Musk Fumes as $500 Billion AI Data Center Investment Comes From Sam Altman and Not Him [SFist]

Image: Close-up of Databricks company logo on building facade, Rincon Hill, San Francisco, California, June 7, 2024. (Photo by Smith Collection/Gado/Getty Images)