I guess when I read launch I was just thinking the app itself was focused on that city. I wasn't thinking of it in terms of your business based out of there.
If it was just the app and the app has some local components then a city you know could be helpful.
If we're talking establishment of a company, employees, etc, that is something else and way beyond my knowledge ;)
http://www.paulgraham.com/startuphubs.html