I don't think that's the case. It is appropriate to think and speak in terms of risk for employees. Consider the contrary case: self employment. I don't mean fo

I don't think that's the case. It is appropriate to think and speak in terms of risk for employees. Consider the contrary case: self employment. I don't mean founders here, but freelancers, consultants, bootstrappers etc. They really are paid by the amount of value they produce, or as close to it as we can determine via the market. Success as a freelancer depends on being able to produce a large amount of value and being able to capture as much of it as possible. There's an incredible range here, from getting $0.03 to do human-OCR on Mechanical Turk to Hillary-Clinton-style $300,000 speaking engagements. It's highly variable over time as well. Freelancers are constantly looking for new clients, and badgering existing clients to actually pay them. They also have to be prepared to have dry-spells where they're not earning at all. In other words, it's risky. Given that backdrop, the value that employers offer to employees is reduction of risk. Employees are not exposed to the downside risks of the market, nor do they participate in the upside when the business does well. Employees do risk losing their job, but that risk is generally pretty low. Startups, though, offer less risk reduction than more established companies. Some of this is intentional, to align incentives and select for employees comfortable with the big-risk-big-reward reality of a startup. Some of it comes from the inherent instability of startups. Chances that a startup employee will abruptly lose her job, or not get paid for work already done is much higher employees of established companies. Even the "big reward" scenarios tend toward instability—for example, "Good news, we being acquired by Google! Now we all have to move to Mountain View." Because of this, evaluating a job offer from a startup has to involve an assessment of the risk it involves. A portion of compensation is usually equity, and that equity is of completely unknown value, compared to say, RSUs as Facebook. The job being offered is inherently temporary, since the company will either fail, be acquired or transform into a completely different company within a few years. It's less risk than freelancing, but much more risk than working at a big company.