But trying to get more effort for the same money by anathematizing side projects breaks encapsulation on the employee/employer relationship. It's obnoxious and involves matters that are (literally) none of his business (at least in California).
You haven't actually refuted the point of this article. You can do one thing better than two. If you believe in your startup, then you'll do it better working on it fulltime. Else, if you believe in the startup you're working for, then just focus on that. You will probably get better outcomes on either front.
This isn't a legal argument, it's general advice. He also didn't say you can't do a full-time job and a startup on the side. He said it's hard to excel at your job when you're doing a startup on the side.
If your side-project has a low probability of a high reward, then having a steady paycheck from a job is a good floor to have under you, if you're not floating around on a cushion of wealth. The author closes with "I hope you have what it takes to commit and become a real entrepreneur" but the reality is "what it takes" is to a large extent money. If you don't have it, you need to get it from your day job.