Good Hacker Cities
madmotive: Brighton, UK works fantastically for us. You can walk between most parts, most tech businesses and coworking spaces are fairly central.  There are regular trains and buses to get out to Sussex University where there are a bunch more.  The community is very welcoming and there are events and user groups almost every day of the week (http://sussexdigital.com).  When you need big customers and investors London is less than an hour away by train.