I agree with your overall premise, but I think you and the parent are talking about fundamentally different things.
If I'm at a startup and I'm constantly working 14 hour days, I want equity. Because I am not going to work 14 hour days (or even 10 hour days) for just a normal base salary. I mean, sure, I wouldn't mind instead taking 4x a normal base salary to work those 14 hour days, but no company (startup or established business) is going to give you that deal. That equity may end up being worth nothing over the long term, but by joining an early startup, I am betting on a solid founding team and the product, and the team's ability to execute. And because it's a small team, I'm betting that I personally can be a big component in whether or not the company succeeds or fails. (Often it'll succeed or fail despite what I do, but that's not the point.)
We can debate the wisdom (with regard to productivity and health outcomes) of working habitual 14 hour days at all in the first place, but the bottom line is that if I'm going to be pouring so much of my life into something, I at least want the possibility (even if the probability is low) of a life-changing financial outcome. It's pretty rare that you're going to get that with a base salary, even at a larger, well-established, public company that has decently high growth.
And I get it, some people just don't want to make the base vs. illiquid-equity trade off. An early-stage startup is probably not for those people anyway, and there's nothing wrong with that. I did it three times: one was a complete flop (after I'd paid to exercise options that became worthless shares), one was a mediocre flop (got out of there in under a year, knew they were incapable of shipping, turned out I was right), and one was more successful than I ever expected. And yet I'm happy I joined all three, even the first one.
> Outside of FAANG (and top executives at F500 sized public companies) very few people are getting rich off of the "equity" component of their TC.
Not even at* FAANG. A new hire (today) at one of those companies is not going to get a life-changing equity grant. A hire from back when they were relatively new companies (or, as with Apple, down in the dumps circa 2000) can get that. But, a hire at that point will be expected to work more (often much more) than a normal 8-hour day.
I think people forget that a mulit-millionaire Googler who has been there since 2003 and is still there now is likely mainly rich because of the equity they got in the first 3 or 4 years. As companies mature, their equity comp declines rapidly. If that same person had joined Google 5 or 7 or even 10 years ago as an individual contributor, their equity comp would not make them rich; they're now getting most of their wealth from base salary.
> The vast majority of startups go bust before IPO or acquisition.
Right. And that's why you shouldn't join a startup because you expect to get rich. You should join because you like that style of work better than large-corporation life. But if they're going to expect you to pour your life into that startup, you should get a big chunk of equity that can -- if things work out -- compensate you for those long hours someday.