The problem with that theory, is that no employee below a senior CXO position will ever get an employee contract that provides them _any_ level of protection. If you can't trust your potential employer, that employee contract doesn't give you, or your so called equity, a spit of protection. In a Private Equity, you can, at the drop of a hat, be diluted to nothing. A new round of funding can come in at a 2X, 3X, or, in some vulture rounds, 5X liquidation preference - effectively wiping out any value your common has.
Employees get no almost no protection from their employee contracts - 99.9% of the signing employees didn't write them, the company's who are hiring them did. 99% of those employees don't negotiate terms to their benefit based on that contract. Other than the Founders and other groups with controlling shares, most of the common is worthless while the venture is private, subject only to the good graces and manners of Sr. Management.
So, respectfully, I'll have to disagree with patio11 - when signing an employee contract in the valley, it's all about trusting the founders, and controlling parties - your contract isn't going to do anything whatsoever for you should Scrooge McStealYourEquity take over.
Employees get no almost no protection from their employee contracts - 99.9% of the signing employees didn't write them, the company's who are hiring them did. 99% of those employees don't negotiate terms to their benefit based on that contract. Other than the Founders and other groups with controlling shares, most of the common is worthless while the venture is private, subject only to the good graces and manners of Sr. Management.
So, respectfully, I'll have to disagree with patio11 - when signing an employee contract in the valley, it's all about trusting the founders, and controlling parties - your contract isn't going to do anything whatsoever for you should Scrooge McStealYourEquity take over.