If you don't need investors or cofounders/employees, there is no advantage to a startup hub. You could live anywhere with an Internet connection and a (VoIP) phone. In fact in such a situation it makes sense to live in an area with lower cost of living, as Balsamiq's founder is doing.
Cofounders exert a lot of peer pressure. I'd be surprised if being in physical proximity to other startuppy friends generally matters much, considering we do some of that interaction online (HN/Facebook/email/etc.) anyway.
Bologna is not a cheap place to live, although IIRC maybe he had some help with the apartment, which would be a big contribution. Italy in general is pretty expensive these days, especially considering the salaries.
On top of all that, the product seems pretty cool.