[gricardo99]

That's an interesting excuse...

If the founders control the company, then they can dictate the terms of employee compensation. To a degree at least... I guess they cannot unilaterally make decisions that completely piss-off and alienate their investors, or good luck with series B.

If the VCs control the company, then I'm sure their response would be "we offer industry standard x% of equity, so there's no reason to offer more".

Chicken and egg problem. It won't change until someone changes it.

Another thought: Where would the increase in employee equity come from? Would the founders dilute their share, or expect all shareholders to dilute? If it's just the founders deciding to be more generous, then why should the board have a problem? The board should be absolutely in favor of founder-only dilution, since it costs other investors nothing, and ostensibly results in a more motivated workforce.