we can't launch Foursquare both in Silicon Valley and in New York City and see which has the better outcome.
Well, I think the OP's point is that you aren't as likely to get as far as launch in, say, Houston than you are in SV.
The problem is that it's hard to get a quantifiable handle on the question, not only because it is hard to count startups that never got off the ground, but also because it doesn't have to be true; people just have to believe it to be true.
In other words, if everybody who wants to launch a startup moves to SV because they think they have to, it becomes a self fulfilling prophecy, irrespective of whether it was originally true.
