SF startups just need to become competent at international hiring.

Head to head competition with a FAANG is not really viable for a startup, so either you get guys who just want to be in startup land (and are willing to knock their salary in HALF, which some do!) or you hire planet wide, which also works well. Yes the FAANGs increasingly hire there too, but they are not big enough to hire all strong devs in the world.

(FYI. I often hire internationally, yet I am based in SF)