Is San Francisco’s Distant Work Backlash Lastly Gaining Steam?

Tech CEO Flo Crivello was passionate about the way Covid was transforming work — so much so that he founded a company in 2020 with the goal of helping teams building virtual office software to work remotely.

But three years later, he’s completely flipped that theory. While building his new startup, Lindy.Ai, which uses artificial intelligence as personal assistants, he has come to the conclusion that remote work simply won’t work for the company he and his employees are building.

Last month, Crivello sent a memo to his team of 22, explaining the reasons for his resignation and calling people back to work in San Francisco. The company has signed a lease at 1841 Market St. on the edge of the Mission District and is in the process of installing desks and furniture.

“To be honest, it’s a bit embarrassing for me to do a 180 like that after hitting the distant drum so hard,” Crivello said in an interview. “But this isn’t about, ‘This is a team that didn’t do it right or doesn’t know what they’re doing.'”

Lindy Drope (left) and Flo Crivello (right) work in their new San Francisco office on June 23, 2023. Lindy founder and CEO Flo Crivello is preparing for his employees to return to the workplace after working remotely for the first time since the pandemic. | Isaac Ceja/The Standard

Ultimately there is ego and there are business realities. Crivello said the growing consensus among himself and his founding cohort is that there’s simply no substitute for working in person. For one thing, virtual meeting technology sometimes just doesn’t work, and even when it does, the call quality just isn’t up to scratch.

“The experiment is over; We tried and failed as an industry,” Crivello said. “It’s hard to beat how the brain has evolved over millions of years for synchronous face-to-face collaboration. Everyone just wants to get out of the damn Zoom meeting.”

His thoughts echo the growing chorus of public comments from technology leaders like OpenAI CEO Sam Altman, who called the industry’s rush to adopt permanent remote work one of its “worst mistakes in a long time.”

Garry Tan, the CEO of Y Combinator, one of the country’s leading startup incubators, said at the Axios BFD Dealmakers Summit in San Francisco that he was focused on reintroducing aspects of the startup incubator in person. Y Combinator’s most recent participants met in person 86% of the time, and he plans to push that number to “99-100%” this time.

Tan pointed out the impact that face-to-face conversations and meetings can have, especially for companies in the early stages of their development.

“The one team that is staring at each other and has extremely high bandwidth communications will probably beat that [remote] Team nine times out of ten,” Tan said.

Some larger companies are also requiring their employees to return to the office, at least part-time. Meta, for example, recently told employees they must return to work three days a week starting in September.

Lindy founder and CEO Flo Crivello sits during a remote meeting in San Francisco June 23, 2023. | Isaac Ceja/The Standard

Real estate sources say AI firms are among the companies currently looking for large office space. City leaders were more than happy to take the baton, with Mayor London Breed recently proclaiming San Francisco the “AI Capital of the World.”

“It seems to be an area where there is actually growth. “I think that’s particularly interesting at a time when big tech companies are still on the decline,” said Ted Egan, the city’s chief economist. “Of course, I think AI is a big demand engine at the moment.”

The data so far shows no changing views on remote work in the tech world. Office vacancies in San Francisco are at record levels, and downtown pedestrian traffic lags far behind other U.S. cities compared to pre-pandemic numbers.

For his part, Crivello estimated that 90% of people were thrilled with the news of the return to the office and about half of the team would relocate to San Francisco. To ease the transition, the company provides bonuses, relocation allowances and salary increases.

Lindy exempts people hired as part of a remote structure, but no additional hires will be made outside of San Francisco. His note to employees includes an FAQ section that responds to some of the city’s perceived issues related to crime and taxes.

However, Crivello is not blind to the benefits of working remotely, particularly in terms of work-life balance and flexibility for those with families. However, he believes there is no better place or method than to build an AI startup locally in San Francisco.

Lindy founder and CEO Flo Crivello poses for a portrait at the new Lindy office in San Francisco on June 23, 2023. | Isaac Ceja/The Standard

As a metaphor to explain this, he used the example of lichens, which often grow on rocks or trees and are formed by a synergistic combination of algae or bacteria and a fungus.

“The Bay Area is very similar because there’s a close relationship between the three things – investors, founders and employees,” Crivello said. “That’s strong for the technology and even stronger for the AI ​​because everyone is here.”

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