If you opened the same company in Seattle instead of SF, you'd get to keep around 9% more of your income. That was enough margin for me to leave CA for WA five years ago. (Though the recall election didn't help my feelings toward the place.)
Also nice, but much newer, is a law that makes what you do with your own time, resources and ideas your own.
So to reify this, if I can't open "the same company in Seattle" simply because I'm shackled by a ludicrous non-complete them I'm damn well going to open it somewhere in California or give up altogether (well, I suppose moving out of the country might be an option).
And this goes for subsequent startups; this is a critical part the SF/SV ecosystem.
Question: does your startup's employee contracts include non-competes?
If someone is encumbered a geographical non-compete and they're leaving another state where they signed a non-compete, I'm willing to bet that the court battle will actually be in the original state, so CA law wouldn't apply. But again, IANAL.
I'm anti-non-competes unless a truly specific case warrants it (for commissioned sales teams, for example... I think it's reasonable that your new salesperson can't come in, print off your leads and go off on his own the next day).