SAP Labs Silicon Valley in Palo Alto

Most of the big names in Stanford Research Park started nearby. SAP did not. The software company was founded in Germany in 1972 and is still headquartered in Walldorf. Yet for about three decades it has kept one of its largest development centers outside Europe on Hillview Avenue in Palo Alto. Thousands of engineers, designers and product managers have worked there, a few minutes from Stanford and across the road from some of the valley's best known campuses.

This profile covers what SAP Labs Silicon Valley is, when it arrived, what happens on the Hillview Avenue campus and what a visitor can actually see. For the bigger picture of the park, read our guide to Stanford Research Park.

SAP in brief

SAP makes enterprise software, the systems that large organizations use to run finance, supply chains, purchasing, human resources and much more. Five former IBM engineers founded it in June 1972 in Weinheim, West Germany. Among them were Dietmar Hopp, Klaus Tschira and Hasso Plattner. Its headquarters has long been in Walldorf, near Heidelberg. Wikipedia describes it as the largest software company in Europe, with offices in 78 countries and about 110,000 employees.

SAP's name is an abbreviation of its German title, roughly "Systems, Applications and Products in Data Processing." Its products are rarely seen by consumers, but many of the world's biggest companies run their accounting and operations on them. That business model explains the Palo Alto campus. SAP needs engineers who know the latest cloud, data and design methods. It also wants to be close to the American customers and partners who shape them.

What SAP Labs means

SAP groups its main development centers into what it calls the SAP Labs network. According to Wikipedia, the network spans more than 20 countries and holds over 80 percent of SAP's engineering workforce. India has the largest operation outside Germany. Other labs sit in China, Canada, France, Ireland, Israel, Brazil and Mexico, among others.

The American branch is SAP Labs US. SAP's own labs page says it was founded in 1996. It credits the US labs with championing design thinking and cloud expertise and with working closely with technology partners, universities and startups. The Palo Alto campus is the best known part of that operation, which is why the company often calls it SAP Labs Silicon Valley.

Arriving in Palo Alto in the 1990s

SAP's American expansion came during the 1990s, as its business software spread through large US companies. A development center close to Stanford and the Silicon Valley hardware makers made sense. SAP gives 1996 as the founding year of SAP Labs US. A June 2007 report in Internet News said SAP had operated its Palo Alto facility for more than ten years by then. Both point to the mid 1990s, though we could not confirm the exact month SAP first opened its doors on Hillview Avenue.

SAP's ties to Stanford run through one of its founders. Stanford's design school carries the name of SAP co-founder Hasso Plattner. Its formal title is the Hasso Plattner Institute of Design. Our page on the d.school explains how it works today. That link matters because design thinking, the method the d.school teaches, became part of how SAP's Palo Alto teams describe their work.

The 2007 Co-Innovation Lab

A milestone came in June 2007. SAP opened a Co-Innovation Lab on the Palo Alto campus. Chief executive Henning Kagermann came for the unveiling, along with executives from HP, Intel, Cisco and NetApp, which donated computers and storage for the lab. Kagermann said the Silicon Valley lab was an offshoot of a similar facility at SAP's headquarters in Walldorf.

The idea was to show SAP software running on real hardware from several vendors, with real data, rather than canned demos. Partner companies, software vendors and systems integrators could run joint projects there. Internet News reported that SAP already employed more than 1,600 people at the Palo Alto facility at the time. That made it one of the larger employers in the research park, though still far smaller than Hewlett-Packard at its peak. Our Hewlett-Packard profile covers HP's own research park history.

The Hillview Avenue campus today

SAP's AppHaus network lists its Palo Alto contact address as SAP Building 1, 3410 Hillview Avenue, Palo Alto, CA 94304. The AppHaus is a design and co-innovation space for customer workshops. SAP says it shares Building 1 with the Palo Alto Experience Center, a briefing center for customers. The AppHaus space includes a design thinking workshop area, a garage-style breakout room, two meeting rooms, a maker space and a small library.

The rest of the campus holds offices and development teams. SAP describes the setting as part of Stanford Research Park, close to other large technology companies and the startup community. The Stanford Research Park tenant list on our park guide includes SAP among its current tenants, along with HP Inc., Tesla and Broadcom.

The neighbors on Hillview Avenue

Hillview Avenue is one of the most storied streets in the park. A short stretch holds several campuses with famous histories:

The VMware profile covers the campus across the road. Our TIBCO page covers the software company a little further down the street.

Why a German company chose Palo Alto

SAP's reasons are the same ones that drew Varian, HP and Xerox to the park decades earlier. Stanford trains engineers and designers a short bike ride away. Venture-backed startups build tools that SAP may partner with or buy. Big American customers send executives to the Bay Area for briefings. And the research park offers modern buildings on long ground leases rather than the cramped offices of downtown.

There is also a practical point. Much of the company's cloud and user experience work ties into American platforms and partners. Teams in Palo Alto can meet those partners in person without a transatlantic flight. The 2007 Co-Innovation Lab, built with hardware from HP, Intel, Cisco and NetApp, is an early example of that thinking.

Timeline

Seeing the campus

SAP's Palo Alto campus is a working corporate site. You can drive or bike along Hillview Avenue and see its low buildings from the street, but do not walk into lobbies or parking areas. Customer sessions at the Experience Center and AppHaus are by arrangement through SAP.

• By bike. Hillview Avenue is an easy ride from the California Avenue Caltrain station. Our biking guide covers routes across town.
• By car. Page Mill Road connects the park with Interstate 280 and El Camino Real. Parking is controlled by each tenant.
• Nearby lunch. The Hub at Porter Drive and Hillview Avenue has a Coupa Café that serves people who work in the park.

Pair the drive with a pass by 1501 Page Mill Road, where HP Inc. is still headquartered. Then head up Coyote Hill Road, home of the former Xerox PARC. For a full route, follow our famous tech addresses tour. For other companies with a Palo Alto chapter, see the companies guide.

Frequently asked questions