Startups need an exit strategy.
Employees want to work 5-10 years max and end up with millions to retire peacefully while working in an intense environment which serves as the story of their accomplishment for the lifetime.
Then they plan to follow their other life goals like going on a world tour with the family or watch their kids growing up or creating their own small lifestyle business. It can be anything.
The key realization is that most employees do not want to work for you just because they have found themselves in such place.
When I was new in the industry, I put a lot of blood/sweat into building a company. Today, I can't force myself to put the same amount of efforts even if I want to.
The idea is to raise money fast, hire experienced people for ancillary services and develop the application in a way so that it is able to hold up till IPO. Defer all costs (application maintenance, vendor lockins, IP infringement risks) for post IPO. Create the Hype around the product which gets you eyeballs, subscriptions, MAU and other metrics which translates into the valuation. Once you've caught market attention, the solution can always get more love post IPO.
The market pressure to produce returns post IPO results in the broad application of the company's IP, resources, and talent. This might spin up new industries.
Once the employees have cashed their equity, it's up to them to stay (if they are enjoying the position) or leave (if they've other life goals).
A lifestyle business, won't be able to achieve this for each of their employees. Even very few startups achieve this for most of their employees.
Nopes, founders want millions by (ideally) using technology to disrupt a market and gaining from the windfall.
VC want millions/billions by betting money on such founders.
They both agree to buy talent by promising employees a share of the windfall.
Employees don't start out thinking "hey I want millions, let me join this unknown company".
They usually start out "I need a good, well paying job where I do interesting work."
This sounds like either it is an extremely unrealistic expectation or it's extremely unfair.
I know lots of smart people who worked for at least 10 years in very intense startup environments and got essentially nothing out of it. Often, they have to fallback on a life of contract work for huge boring corporations.
Yes, it's not guaranteed by anything.
I also know of cases where founder alone ended up with billions and early employees got nothing.
I just see those startups as poorly executed who decided to kill their army after victory way home.
We should strive for execution where at least your comrades also win.
It is not a zero-sum game. You win when your comrades win. The glory is not in taking it all but taking pride in what you have created and can potentially create and expand on over and over again. :)
Every dollar of an exit given to an employee is a dollar that the VC or founder can't have.
Strip the ideal away and people will leave in droves. Without a differentiator, startups are just like everything else.
Then it's time to play the game of "compete against each other, and the worst 10% gets fired". Suddenly the talent becomes cheaper, and stops talking about work-life balance.
In Silicon Valley, pay is high, so is the cost of living, reverse in other places. If your situation differs, you've got it good (unless you're in a bad job in a high cost of living place)