All of our smart entrepreneurs go to Silicon Valley where the money and other talent is? I live in Toronto and can't count the number of friends I've know who moved to either SF or Seattle. The only reason I didn't move there was because I didn't have a 4yr "advanced degree" to qualify for a T1 visa (despite having a job + lawyer). Most leave right out of university. Considering jobs are $60-70k vs $150-200k I don't blame any of them.

Otherwise I believe it's a pretty good place to start a company. Our income taxes are equivalent to California and I believe our corporate taxes are lower but we have health care and relatively cheap housing downtown thanks to a housing development boom.

We also have a startup founder visa and an easier immigration policy. Access to seed capital and higher-end talent is the only constraint.

But people moving to take jobs aren't people moving to start companies. I lived in Toronto in the late '80s and found it to have a pretty decent startup culture. My wife worked for Alias at the time.

I don't understand why there is such a huge salary difference between Toronto and SF. I'd love to move to Toronto but really don't want to take that huge salary hit.

You should see how much the Canadian government taxes you before you do anything.

It's about even from the personal income tax side in california. Companies don't pay for healthcare so that 'tax' is gone. I don't think there is much of a difference past that.

Right now? Same reason anywhere else outside of SV isn't one. Momentum. The money is in SV, and has absolutely no desire to move anywhere else.

There's a network effect. People want to live in a place where they have plenty of options if their current job doesn't work out. Employers want to have a large pool of local talent to draw from. This is all self-reinforcing and probably the reason why companies start and stay in the SF bay area even though the cost of living is insane.

As long as the VCs don't want to invest in a company they can't drive to in an hour or less, that's going to be a problem.

Critical mass, proximity, overpriced west-coast Canadian real estate market?

By contrast, Berlin seems to be doing fairly well, despite a language barrier (for English speakers). Israel (Tel Aviv) as well.

The specificity of high tech to the SF-SJ region is curious.

I've heard before that access to funding is a huge problem.