Your choice of words is telling: "mercenary" and "shark" are overwhelmingly negative. By characterising people who disagree with your assessment of equity that way, you risk being perceived as a confidence man. Con men sell hope to the greedy at a steep markup; they are perfectly willing to use guilt if that's what it takes to reel in the mark. Anything to get someone to buy into their schemes for their own profit; in this case, by accepting worthless scrip in lieu of proper compensation. If you don't want to be perceived as unscrupulous, you should reconsider how you characterise people with different values.
I didn't get burned in 2001. I watched a bunch of people who thought they were rich suddenly realise that not only were they not rich, they were also out of a job with no prospects, through no fault of their own. I wasn't personally harmed; I rather enjoyed paying 40% less rent and spending half as much time commuting. Nevertheless, it was a magnificent learning opportunity for a young engineer, just as the bursting of this bubble will be for others. For anyone who prefers to learn the easy way, the takeaways were:
1. The market price of your equity is determined by almost every conceivable factor except the merits of your own work.
2. So few companies succeed in a way that makes your equity of life-altering market value that you should approximate the probability as zero.
3. You will not live long enough to accumulate enough wisdom to beat the market; that is, you are not better than average at identifying early-stage companies that are much more likely than average to be successful as in (2).
4. More generally, humans don't live long enough for buying variance to be a good strategy unless you are desperately poor. Otherwise, sell variance any time you can do so ev-neutrally. If you simply must buy variance, pay as little ev as possible for it. Flips and roulette are good; the lottery and buying stock on margin are bad.
"Life-changing upside" changes very few lives, even fewer deservedly so. If we lived 100,000 years, it might make sense to take a few thousand gambles on early-stage startups; the variance would mostly work itself out, and after a while you might even be able to tell who's likely to succeed so that your choice of employers would be +ev. In one 40-year career, forget it. The path to true wealth consists first of an inexpensive lifestyle and second of salary maximisation. Higher ev, lower variance.
There's a way to make an argument without calling your counterparty a "con man". I'm more on your side than the parent's side (though the idea of valuing equity at zero is illogical). I think your comment would be stronger without its first paragraph.
There's a way to make his case without calling anyone who disagrees a "shark" or a "mercenary". In fact, I think his choice of language was quite revealing of the true origins of his position; if it is not, he would do well to reconsider how it is perceived by others.
He didn't call you a mercenary. You did imply he was a con man. I know the difference seems subtle, but one is much worse than the other. Even if you disagree, two wrongs don't make a right.
I didn't get burned in 2001. I watched a bunch of people who thought they were rich suddenly realise that not only were they not rich, they were also out of a job with no prospects, through no fault of their own. I wasn't personally harmed; I rather enjoyed paying 40% less rent and spending half as much time commuting. Nevertheless, it was a magnificent learning opportunity for a young engineer, just as the bursting of this bubble will be for others. For anyone who prefers to learn the easy way, the takeaways were:
1. The market price of your equity is determined by almost every conceivable factor except the merits of your own work.
2. So few companies succeed in a way that makes your equity of life-altering market value that you should approximate the probability as zero.
3. You will not live long enough to accumulate enough wisdom to beat the market; that is, you are not better than average at identifying early-stage companies that are much more likely than average to be successful as in (2).
4. More generally, humans don't live long enough for buying variance to be a good strategy unless you are desperately poor. Otherwise, sell variance any time you can do so ev-neutrally. If you simply must buy variance, pay as little ev as possible for it. Flips and roulette are good; the lottery and buying stock on margin are bad.
"Life-changing upside" changes very few lives, even fewer deservedly so. If we lived 100,000 years, it might make sense to take a few thousand gambles on early-stage startups; the variance would mostly work itself out, and after a while you might even be able to tell who's likely to succeed so that your choice of employers would be +ev. In one 40-year career, forget it. The path to true wealth consists first of an inexpensive lifestyle and second of salary maximisation. Higher ev, lower variance.
(first paragraph edited for tone)