And yet, we still get posts like this one, and comments like yours, that make it seem like somehow the employees are the ones who are getting shafted.
Could equity deals be a little more clear and fair? Sure, absolutely. Maybe make the window for options something more like 6-12 months. It's entirely subjective. But when the "make or break" lifecycle of a startup is 5 years, waiting 6 months to make a critical hire because you have options tied up in people who don't even contribute to the organization anymore is detrimental AND unfair to the current employees.
It shouldn't make you sad that you couldn't exercise your shares. It should make you sad that you didn't work more effectively the capitalize on your options sooner.
Of course, nobody gives employees options on preferred shares.
It seems like you're whining about something that you had complete control over, and chose not to exercise.
1/3% (and that's generous) of a potentially $1B dollar company might seem like a lot, but after 10 years of dilution how much will you really have left? If your options dilute by 1/4 (also generous), you've made about an extra $80k a year, and that's not even with taxes subtracted. And don't forget the likely higher salary, raises, bonuses, stock grants, and medical care you get at a big 4 company.
It's possible that you can be be assured to make no extra money working for a startup, even with all the extra risk, depending on how those factors play out.