My sincere belief is that there are a large number of employees whose total comp is over $400k and they provide far less value than that. But the arms race between FAANG drove up salaries to illogical levels. As people are pushed out they will not be able to hop to another FAANG. While total comp at startups might be similar but the equity isn’t liquid like FAANG is.
Additionally the skillset to succeed at a large corp is very different from a startup. It will be a psychological shock to go from a FAANG environment to a small company.
In summary I think there will be some hard life lessons for some previously extremely well compensated tech folks. I hope they saved a lot of their past salaries.