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Yes, but usually the employee sees something if the company is successful.

It's like playing Powerball, winning, and then the lottery agency saying "just kidding."




Not really... usually the employee sees nothing. I also don't know if the employee really deserves to see anything - lots of people work dev jobs and see nothing over salary for it, why should you make bank if you did you job just as well but happened to be in a wildly successful company... Concurrently I think that founder compensation is absolute BS at the moment, their contributions to success are far less effective than their compensation would suggest.


Because devs working for startups that pay heavily in equity are usually not making what they would make if they were paid 100% in cash.


Sometimes. Sometimes they are given equity (or options on the equity) - other times there is an "understanding"[1] about equity as happened in Toptal. Once you have equity... it's worthless, or near to - it only becomes valuable if the company does well... and if your effective equity isn't diluted in successive rounds - which it quite often is. You've surrendered a portion of your salary for a potential to get paid if the company does well (maybe) - and it's doing well is, in a large part, out of your hands. There is far too much good-faith being required from employees in these sorts of setups and, if everything goes as planned, why should you get a payday while the person who went to work for a perfectly good company that failed gets nothing? That could have been you!

1. So, some deceptively worded stuff that ends up being worthless.




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