I have lived in LA, New York, and Tokyo. They all have talents. However, it isn't created equal. The companies outside silicon valley aren't using the best technologies, don't have the best processes, don't use the best softwares, which in turn affects the talents. The talents aren't attending the latest tech meetups in SV, aren't using the best tools, aren't doing the best coding practices, using the best frameworks, etc.
IMO, there's a 10X difference currently between tech startups in SF and tech startups in LA or New York; I've worked with teams inside and outside silicon valley. The calibur of talent/progress difference is just insane.