One thing to recognize about San Francisco is that the tech scene is actually spread out across the whole peninsula, not just San Francisco.
While San Francisco has been experiencing a considerable renaissance (my last three companies were HQed in SF), quite a bit of the tech scene is located 30-40 miles South in Santa Clara County.
San Francisco is physically smaller than Manhattan and has about half the population. The rest of the peninsula is pretty suburban. Even in areas of SF that approach Manhattan for density, it is not NYC and it is not trying to be. If you like hyper-competitive people or any hint of pretension, look elsewhere.
That said, yes, SF's startup scene is mecca. Really. The tech density is high enough that you will see tech people literally everywhere, money flows liberally and is well over critical mass for early adopters of technology.
The biggest cons to living here are:
* As a startup, hiring is hard because the best of the best often want to start a company, have started a company or do consulting for startups. I import a lot of people from across the country.
* Microclimates mean going from a t-shirt to a coat with a twenty minute drive.
* Rent is expensive. Maybe not Manhattan expensive, but no less competitive.
* A car are necessary if you live in the peninsula because of how spread out it is.
* You'll be in an environment where there are probably 3+ other startups doing your exact same idea.
Disclosure: I'm from SF.