They typically get paid more than they would ever make if they tried to get a position that matched their skill level at an established company like Apple or Ya

They typically get paid more than they would ever make if they tried to get a position that matched their skill level at an established company like Apple or Yahoo!. Do you have any evidence for that? A lot of the people I know of who are startup CEOs used to be high-level managers/executives at big companies. I don't know of any evidence to support the idea that high-level executives at startups are any more "overpaid" or incompetent than executives at big companies. I would wager that 9 times out of 10 they are hopeless and drive the companies they latch onto into the ground. They certainly require a different skill set than the technical leadership in a company. A CEO needs to be able to give a convincing pitch to VCs, recruit other top talent, close big deals with customers (often other big companies), and decide on the company's direction. Those are all hard skills for a typical engineer to evaluate.