[stouset]

Your first point rings extremely true from my own experience. It's of course the case that there are bright, talented, and experienced engineers in places other than the Bay Area, but it's hard to counter the brain drain that occurs. The best engineers who remain become comparatively rarer and so it becomes progressively more difficult to build a team of seasoned engineers as opposed to having a single veteran try and mentor six or seven inexperienced coworkers.

And in that scenario, you're extremely vulnerable to that senior employee getting burnt out from spending most of their time doing code reviews and putting out fires rather than building things themselves. You're also vulnerable to that person getting an enticing offer from a big-name company in the valley or an exciting-sounding startup in SF. Many of these opportunities are even remote, so this can happen even when your best employees don't have any desire to move.

So yeah, it's possible to find good talent in other locales. But there's a lot more competition for that talent, it's hard to build a critical mass of it when the best employees are constantly moving away, and there are a ton of challenges you have to deal with as a result.