It's very important to treat people well. But you don't always have the money to hire the best people, especially if you're a bootstrapped startup. One of the hardest psychological things about starting a business for me was taking no pay for a long time while paying others decently for work. Having an employee make considerably more than you is not psychologically healthy. I found myself having to guard against irrational feelings of resentment when going through tough times.

Money solves a lot of problems, and I think this is an area where funding is actually useful. Still better to grind through doing all the work yourself and not give out equity though.