Every thing comes down to risk vs reward. Founders risk it all to found companies and rightfully have the greatest reward. Startup employees haven't risked as much but their risk is compensated with appropriate equity the earlier they join and the more risk they take on in the form of lower salary and benefits. YC definitively reduces risk and increases the potential for reward. It's easier for YC companies to raise funding (allowing them to pay market salary and benefits faster) and they have been vetted so we can assume the idea and team have a better shot at success. If you want to work in startups, working for a YC company is a better risk vs reward scenario as compared to a non-YC company. In regards to the post, just ask for more equity in scenario 1. IMHO the first 10 engineers should roughly own all of the "20%" first round option pool and should be able to get the company to an exit, massive profits or the next round. EDIT: last sentence for clarity.