Sure, there isn't really an enforceable non-compete in California, its one of the things that makes Silicon Valley, well Silicon Valley. Second there is a sort of hubris around 'the best revenge is beating them at their own game.' I know of at least two founder/co-founder pairs that split over different ideas about how the vision should go and rather than try to sue the other out of existence, the sense of invulnerability or desire for competition gives rise to a sort of 'bring it on if you got it' mentality.
Even if non-competes are enforceable, sometimes it will make more sense for a company to let an employee go straightaway anyway, rather than having them hang around twiddling their thumbs with no motivation.
True, Where California's statutes affect innovation is in the case where you're trying to raise money. In a state that enforces non-compete agreements you have a harder time if your new venture competes with the place you just left. That is because there is a risk that if you're successful you will be sued by your original employer and shut down. This is not true in California so it is nominally easier to raise funds.
How enforceable are they in other states? I know in the UK there have been a few test cases which seem to have resulted in the interpretation that you can only enforce one if it would otherwise be detrimental to the ex-employer (e.g. starting a new business or taking your contacts with you), otherwise people would find it difficult to move jobs within an industry because you'd almost always be going to a company who could be classed as a competitor.
