I took an almost 50% salary cut when I first started working at justin.tv. I don't think you can generally expect the industry average in an early-stage startup. My salary is nearly back up to what it used to be now though.
If you assume the company's most-recent valuation accurately reflects its worth, then yeah, my equity more-than makes up for my loss. Until there's an exit though of course, the equity is essentially worthless (I find I stay more sane if I just act like it has no more value than a random lottery ticket has).
The general feeling I get from reading HN is that early stage employees take lower salaries in exchange for higher stock options.
As the company matures and expands its perceived risk drops so later hires tend to be more experienced, higher paid, and with less in the way of stock options.
Seeing as BackType has only three people right now I think we can guess it's on the low salary, high stock side of the curve.
