I am disagreeing with the idea that the rank and file (primarily young) employees really understand that they are almost certainly going to make less money than they would working at a big company.
Anecdotal evidence on both sides, but most people I know who have actually gone into very early stage contemporary startups as non-founders were convinced (primarily by being sweet-talked by the founders and money people) that the company they were working for was going to be "the next big thing", and that is already a bad assumption for any startup. But the worse misconception is that even if the startup defies the odds and is quite successful, most younger non-experienced folk remain under the impression that because they were given "1%" of the company to sign-up (at the time when they actually signed up), if the company exits at say $100,000,000 ("real" money but kind of chump change in the days of Instatumblrgram) they will see $1,000,000... which is... not going to happen, not even close. By the time they are fully vested and the company exits, their 1% is probably more like 0.01% or worse. The realities of things like dilution of common stock are obvious to people who live on the money side of the startup world, but not so obvious (in my anecdotal experience) to the heads-down techie types who haven't yet been burned by it.
Anecdotal evidence on both sides, but most people I know who have actually gone into very early stage contemporary startups as non-founders were convinced (primarily by being sweet-talked by the founders and money people) that the company they were working for was going to be "the next big thing", and that is already a bad assumption for any startup. But the worse misconception is that even if the startup defies the odds and is quite successful, most younger non-experienced folk remain under the impression that because they were given "1%" of the company to sign-up (at the time when they actually signed up), if the company exits at say $100,000,000 ("real" money but kind of chump change in the days of Instatumblrgram) they will see $1,000,000... which is... not going to happen, not even close. By the time they are fully vested and the company exits, their 1% is probably more like 0.01% or worse. The realities of things like dilution of common stock are obvious to people who live on the money side of the startup world, but not so obvious (in my anecdotal experience) to the heads-down techie types who haven't yet been burned by it.