depends on the company. since the songkicks were working on live music, it made sense for them to be somewhere with an active live music scene e.g. london.
if you're working on something completely location agnostic and you're getting a lot of valley investor interest around demo day, it probably makes more sense to stay in the US than return to the UK (that's what we did).
This sounds great in principle, but the visa situation seems rather daunting.
"Running a business" is specifically forbidden for visa waiver or B1/B2 visa visitors; besides, I suspect they won't be too happy if you repeatedly "visit" to the extent that >50% of your time is spent in the US. H1-B seems to be a lottery and infeasible if you own the company and are employed by it. I have no idea if we'd qualify for an EB-1, and E1/E2 seem more geared for owners/employees of bigger companies than recently-formed startups.
There seems to have been a string of originally European YC-funded companies that successfully moved to the US, yet there are examples where founders are "stranded" in Europe (e.g. Dailybooth). I vaguely remember an article written by one British founder of a YC startup some years back who got in via an E2, but I can't seem to find it. It would be extremely interesting to hear about past experiences with this; I realise it's possible that there's a good reason why everyone keeps quiet about it.
if you're working on something completely location agnostic and you're getting a lot of valley investor interest around demo day, it probably makes more sense to stay in the US than return to the UK (that's what we did).