This. The bulk of the returns and growth now happens pre-IPO. Then the price at IPO is disconnected from public market expectations. But you’re also at the top of the growth S curve so growth is decelerating.
But as a early employee, when you join before valuation goes up... You still make only scraps, because you're not getting that many shares to start with and "common stock" aren't worth as much as "preferred stock".
Common and preferred shares start to converge as a company approaches IPO. An employees gains are likely to exceed those of VCs in such an event. When companies are acquired and when liquidation preference comes into play is when employees get screwed.