I have nothing against the Bay Area. I went to school here, live here, and started my company here. However, if I want to start another venture down the road I feel like I'd have no choice but to start it here. And not having choice only hurts the entrepreneur.
What I like about Manu's criteria is that they are very clearly laid out. Not all investors make it so easy to know what they expect out of companies, so they end up wasting a founder's time.
Disclosure: I've known Manu since the late 90s, and he invested in my company (IndexTank).
You don't have that asset to sell if your team are spread out across the world, or are located somewhere else.
Lots of folks who aren't already wealthy would prefer living elsewhere (unless you like places with Manhattan-style prices, but no Manhattan-style amenities).
I think anyone who knows Manu can attest that a great investor provides so much more than money. In fact, this is part of his investment thesis, and, in my opinion, helps to explain why his first fund was such a success.
So if you're raising your seed round and you haven't talked with Manu, you should be asking yourself: why?
On the other hand, starting your business in a random town probably won't have great odds.