The investors invests $500k NOW, usually with no ability to take their money back. The employee invests $136 each day with the option to leave and cut their losses anytime.
(a) That depends on where you are.
(b) You are ignoring the opportunity cost to the employee (though admittedly this is consistent with the original article).
(c) You are ignoring the potential adverse consequences on the employee's future career of being associated with a failed start-up, leaving a job early to chase dreams, etc. (Please don't tell me that it's better to have a CV showing you worked at several failed start-ups than it is to have a solid track record of demonstrable good results at established companies. That is the kind of fiction that only people in the start-up community manage to believe.)
Fair point - the value invested by the employee should be discounted, but:
"usually with no ability to take their money back"
Actually, the investors have more ability to take their money back than the employee. The investors can at least sell what's left of the company, while the investment by the employee is unrecoverable.
I also agree with the other posters: "paycheck" employees are not good hires early on in a startup.