In addition to the overall benefits of not having non-compete agreements, California's software startup ecosystem also benefits from not having to deal with charging sales tax when selling SaaS[1][2]
If they are selling SaaS to an entity in California. Which is the same for anyone selling SaaS to an entity in California, regardless of where the seller is located. I do not see why this would give California a competitive advantage in where a business's employees are located.
[1] https://www.taxjar.com/blog/saas-california-sales-tax [2] https://www.cdtfa.ca.gov/lawguides/vol1/sutr/1502.html