Actually the nightlife in the valley is not too exciting. There are bars in downtown Palo Alto and mountain view in the Castro Str. However, most of them close at midnight. Clubs are rare as well. There are only few and those expensive.

So if you actually want to spend a night out, better go to San Francisco or San Jose. The latter one would be the cheaper alternative. Nightlife in San Francisco is much better than in the Valley. There are tons of clubs and bars. Most of them are very expensive though. A cover of 20$ is not out of the ordanary.