Turkey is an amazing place to work and live, there's an incredibly vibrant hacker community, and the people are some of the most welcoming in the world (especially if you're a visitor). Istanbul rents on the European side can run pretty high, but on the Asian side (and with the way the exchange rate is going these days), I think you'd be remiss to leave it out.
If not Istanbul, Ankara has a bunch of universities and rents are considerably cheaper. Bodrum, too, has relatively low rents and absolutely amazing natural beauty. Ok, enough ranting...
Seriously cool concept, though. I look forward to seeing where you take it!