It's funny, the very first piece of advice I got after starting my company was that we should find a way to move to the valley. At the time, I remember thinking "I'm sure it would help, but it's not worth the hassle." How wrong I was.
Granted we're doing pretty well, but my god has it been brutal. And not the good kind of brutal - as in building the product and finding customers - the bad kind of brutal, where you lose good developers because no one wants to live in friggin' Waterloo, and there's maybe 10 active investors in the whole damn city (and we already have 3 of them!)
