ECS Refiners is an e-waste recycling company. It takes old computers and other electronics and breaks them down.
Investigators said the fire started in or near cardboard bins containing plastic.
"So the cardboard got going, then the wood pallet under it, then finally the plastic that was stored inside of it," Santa Clara Fire Department spokesperson Dave Parker said. "There was an enormous, when I got here, I could see it from my office, an enormous amount of dense black smoke coming off of it, which is a definite clue that you have plastic burning."
About 70 employees were inside at the time. All got out safely.
ECS is located in an industrial area of Santa Clara. The city activated a new reverse-911 system to notify neighboring businesses to shelter in place and to keep doors and windows closed because of the smoke.
Fire officials later said there was no toxic risk.
Neighboring business owners did point out that ECS has had several fires in recent years.
"It's caught fire at least four times to my knowledge," Mitch Jilg said.
Parker confirmed he knew of three fires in the past 2.5 years, all outdoors, involving similar storage bins with plastic.
"It indicates I think we need to try as hard as we can to figure out the similarities with these and can we figure out why they got going," Parker said.
Santa Clara firefighters received mutual aid support from San Jose and Mountain View. Some responded to the scene of the fire, others covered fire stations that sent units there.