> But they're the same thing! If investors would accept it, then you could just as easily have the investors buy the equity, and then pay the employee with it.

> But they're the same thing! If investors would accept it, then you could just as easily have the investors buy the equity, and then pay the employee with it. See my [response to inimino](https://news.ycombinator.com/item?id=17291045 https://news.ycombinator.com/item?id=17291045). It's absolutely not the case that if I have $100m worth of stock according to some valuation, I can just go out and sell any amount of that for what you'd expect based on the valuation. VCs are the only ones who are generally ready to buy this sort of equity, and raising money from them is a long difficult process, and I can't just decide I'm going to sell 0.5%, get $500k, and pay that to a new employee. Finding a non-VC to buy your equity is very difficult too. > That's not an early-stage startup, that's a company with >200 employees and a valuation in the hundreds of millions. Like I said, it's the first random ad I clicked. Last I looked at Angel List, there were tons of startups offering 0.01-0.05% equity. Also, notice they're offering this 0.01% with a maximum salary of 130k in SF who is skilled with "Python, Java, Scala, Ruby on Rails, React.js": https://angel.co/everlane/jobs/306986-software-engineer https://angel.co/everlane/jobs/306986-software-engineer That's way below market. > That's not an early-stage startup, that's a company with >200 employees and a valuation in the hundreds of millions. Do you have any idea how many startups were worth >100m at one point or another on paper, and ended up with an exit where nobody but the VCs made any money due to stock preference? One down round is enough to effectively wipe out most of the rank-and-file equity in these scenarios.