> Founders certainly deserve a huge premium for starting the earliest, but probably not 100 or 200x what employee number 5 gets.
When the founders started the company, their equity was pretty much worthless. When employee #5 is hired and gets 0.50% of the company, her equity presumably has some dollar value. Employee #5 gets a better deal than the founders, even though the founders have 100x more equity.
The only thing that matters is the dollar value of the equity at the time it's awarded.