When a SV startup goes belly-up, the first to get fucked are the employees. Even employee #1 and even if you started a week after incorporation, your equity is the first to disappear. And add to that, the fact that many startups have allowed founders and key executives (but not rank and file) to sell options and take money out pre-exit.
In my experience, startup employees are largely not aware of the drastic difference in equity distribution and protections. They know, of course, that founders and investors have a bigger share than they do, but they don't realize how lopsided it is, and that founders can walk away with multimillions as they drop to zero themselves.
In fact, in cases where large numbers of employees got rich (>$1M... Google, FB, etc) from an exit, the founders did not become just "rich", but rather became multibillionaires, and the wealthiest people on the planet.
You know this, and I know this, and frankly anyone who is going to sign an offer letter should know this, but they often don't, and people often don't understand predatory loans either.
If you're an SV engineer making six figures I have no sympathy if you don't understand how your options work. You can afford a personal financial advisor.
Now, good poker players do talk a lot about not being "results-oriented" (even if your AA is rivered by KK, you played the hand well if you got the money in before that), and many players will tell you that the way to do this is to cultivate a sense of detachment about money coming in and out. I certainly try to avoid being sad when I lose a big hand; such is life. But being sad isn't the end of the world, so long as you got the money in good and continue to do so.
Now it's been 5 years, the company looks to be cratering quickly, and you're burnt out. You've been hanging in there because it would be financially insane to quit when you've got a very high likelihood of walking away with millions.
Take that last bit away, and you're telling me you can't understand why engineers might start walking away in droves?
If a Silicon Valley engineer goes and buys a house, planning on a big payout on their options, then they're a fool.
Take that incentive away and you don't have anything to offset the burnout from the work environment there.
Or, put another way, if Uber's shares in 2013 should be estimated at zero, should anyone's shares not? Anyone substantially more stable than Uber is either paying you actual cash, or giving you something with a liquid market and a clear market price (e.g., RSUs on post-IPO stock, which you can just sell as soon as you get them) instead of ISOs.
The entire point of ISOs is to avoid paying your employees a competitive salary entirely in cash by giving them something that you're claiming has more expected value than the difference between their base salary and what they're worth. If you're lying to them, then it's unsurprising that they'll be bitter.
But yes, working for, or investing in, a pre IPO company is risky and if you want to avoid risk you should just make sure you're getting a bi-weekly salary you're happy with.