While I don't know about the status, but compensation is definitely is the correct thinking. Startups need to offer something for less compensation, a lot of times they offer less and even less flexible than a big co.
When you're comparing against Google, outside of Facebook/Netflix pretty much all companies offer less. There are certainly plenty of predatory startups out there that are exploiting labor with unrealistic promises of riches and cap tables that guarantee no such happy outcome for employees. As an employee you have to look out for yourself, but if you set Google as the standard then everyone else is going to look cheap. There are many companies out there who simply don't have the unit economics to compete with FAANG, but may be more attractive for other reasons.
Then they can’t afford google talent. Short of pay they’d have to offer some other compelling narrative (e.g. HBO’s SV “changing the world through algorithms”). In essence it’s a trick to give up their economic advantage.
My main point is that Google doesn't define market comp, they define top-of-market comp. If you are a software engineer expecting to make Google money then you need to make peace with the fact that there are very very few places where you can earn that. It doesn't mean that all other companies are somehow low-balling or cheating their devs just because they don't have Google's money hose of a business.