That's a very good point. But I think the problem is that we're blurring the distinction between founder and employee. I remember an old quote "founders get r

That's a very good point. But I think the problem is that we're blurring the distinction between founder and employee. I remember an old quote "founders get rich, early employees get screwed, and late employees get paid." I've worked for startups where I received a miniscule percentage of the company. But they paid me market rate and provided me with a health plan. The equity was nice, but this was really just a job... ok, it was more than "just a job", I did pursue it with more passion, and there was less stability (and one of them did tank leaving everyone scrambling), but the equity was really a bonus in exchange for the lack of stability and perhaps a more passionate workforce, but it wasn't a stand-in for a substantially below market rate paycheck. So I agree, 20% equity is a massive amount to give to an "employee" who is not a founder. But a 50% pay cut is a massive amount to ask of an "employee" who will not be treated as a founder. That sounds more like the kind of arrangement that might normally be worked out between a couple of founders, where one needs an income and agrees to lower the equity share in exchange, whereas the other goes without income at all. In this case, it does sound like the early employee may be getting a little screwed, because his deal is the worst of both worlds - working for "free" (well half the time) like a founder, but receiving miniscule equity, like an employee.