A good start, but I want to add more. This may seem unrelated, but there's a difference between poker and slots. Both are "gambling", but one has a performance

A good start, but I want to add more. This may seem unrelated, but there's a difference between poker and slots. Both are "gambling", but one has a performance effect and one doesn't: if you're good at poker, you can make money at it (of course, many people lose). With slots, there's no skill. If it's viewed entertainment, fine; but don't think it should take a major place in your lifestyle because it's just going to lose you money. Playing slots is not a sound financial move. For some (top ~2% of poker players) poker is. I'll get back to that. Now... let's say that you're a typical 28-year-old programmer making $120,000 per year in a cushy corporate job. Your financial advisor comes to you, one day, and tells you that you should invest $30,000 of your annual income in penny stocks. Not only that, but it's a single and illiquid penny stock, with tax implications you don't fully understand. Oh, and the company issuing it is your employer and has about a 20% first-year chance of firing you without severance ("for performance" because tech startups never do an honest layoff; they'd rather hurt your reputation than theirs by admitting contraction) and invalidate your investment (called "cliffing") outright. That's your financial advisor's proposal: buy illiquid penny stocks from your boss. What would you do? You'd fire the fuck out of that financial advisor, that's what you'd do. Yet there are plenty of people who'd work for $90,000 (instead of the $120,000) plus "equity" whose expected value is much, much less than $30,000-- maybe $10-15k at-valuation, from the perspective of VCs who have a much higher risk tolerance, who also get control of the company and preferred shares in the deal. It's a shit deal. Don't take it. Now, back to poker vs. slots. If you're a founder, your equity holding (which is likely substantial, unlike typical employee bullshit) is more like poker, because your performance at your job can have a macroscopic effect on the company. Your ability and performance directly affect your payoff (of course, there's a lot of luck, too). You're still gambling in the abstract sense that everything (even driving) is a gamble, but you're taking bets on yourself, which any self-respecting person would do. If you're an engineer or, really, anyone outside of the top O(N^0.25) executives, you're playing slots because nothing you do will have a real effect on the macroscopic performance of the firm. You're betting on people and factors over which you have no influence. Even whether you get that full that 4 years or are fired first is (let's be honest here) outside of your control. Employee equity is a nice-to-have for an otherwise good job paying a market salary (if not above-market, to account for startup risks) but it doesn't justify taking the kinds of pay cuts involved at most of these startups.