Parent is presumably referring to public companies. Many of us have a sizable chunk of our compensation coming from RSUs.
> Employees have equity grants worth $100k/year in equity, with the value based on a fundraise from last summer?
Yes I have RSUs from FAANG that are down 30% YTD. But when they vest in the next two months, at least I can sell them and diversify and use them for something.
If it were a private company, not so much.
Also as you called out the problem is largely worse for private companies.
Private non profitable companies are stuck in a catch-22. If they offer more cash they increase their burn rate. If they don’t, their best employees leave and they lessen their chances to ever go public. On top of that, how many VCs will just cut bait and let the business fail? What are the chances that they can get another round of funding and if so, it’s not a down round making it even worse for existing employees?