Nothing immoral about it, but it's not quite as rosy as you portray it to be. Most venture capitalists don't play with much of their own money, but rather play with the capital of their limited partners. As an industry, they provide pretty anemic returns to those limited partners. But almost all make a lot of money personally, because their standard arrangement with their limited partners is to charge a portion of the principal and a portion of the return as a fee. Why do limited partners keep taking those deals? Who knows? A combination of inertia, desperation, and bad judgment. Many big institutional pension funds are under tremendous pressure to yield very high returns and at the same time often aren't run by the best and brightest Wall Street has to offer.
Also, as a startup founder, your investment of labor also comes with a high risk in the form of opportunity cost.