And the terms of those risks are determined based on the leverage of the various parties at the time they join the venture.
You can start a company and raise money by selling common stock instead of preferred, but in return investors are going to want a much greater share of the company than they otherwise would. That's generally a bad deal for employees.
You can say that it's unfair that deals generally work out they way they do, but that's not really any different from saying that it's unfair that your salary is 100k (or whatever) instead of 200k. Welcome to a market economy. Prices are negotiated based on supply and demand.
You can start a company and raise money by selling common stock instead of preferred, but in return investors are going to want a much greater share of the company than they otherwise would. That's generally a bad deal for employees.
You can say that it's unfair that deals generally work out they way they do, but that's not really any different from saying that it's unfair that your salary is 100k (or whatever) instead of 200k. Welcome to a market economy. Prices are negotiated based on supply and demand.