Trading stock for equity is almost never worth it - as a basic reality. Clearly it is occasionally, or the system would collapse.
Let's say you receive $40k in salary a year (versus equity), for 5 years (let's call that $200k, just for fun). Assuming you're diligent, that salary difference can be invested, even in something as simple a preferred shares, yield a compounded return of +/- 5%, or ~$232k. So, we're not really talking about high levels of risk.
Assuming your startup, like most others has 6 funding rounds before an exit, and that insiders hold the traditional 4% at exit - we'd be looking at someone who started with a full 1% (of the initial, pre-dilution point) of the company, yielding ~$341k over the same period.
Given that 1% holdings are rather high - 0.5% or less would be well expected. That in turn means that unless your company exits for ~275M (over this 5 year period), and you hold 0.5% then FINANCIALLY it's not worth being part of that endeavour.
That being said there are several other great reasons to enjoy startups.
Let's say you receive $40k in salary a year (versus equity), for 5 years (let's call that $200k, just for fun). Assuming you're diligent, that salary difference can be invested, even in something as simple a preferred shares, yield a compounded return of +/- 5%, or ~$232k. So, we're not really talking about high levels of risk.
Assuming your startup, like most others has 6 funding rounds before an exit, and that insiders hold the traditional 4% at exit - we'd be looking at someone who started with a full 1% (of the initial, pre-dilution point) of the company, yielding ~$341k over the same period.
Given that 1% holdings are rather high - 0.5% or less would be well expected. That in turn means that unless your company exits for ~275M (over this 5 year period), and you hold 0.5% then FINANCIALLY it's not worth being part of that endeavour.
That being said there are several other great reasons to enjoy startups.