[rdl]

Ask them to articulate why equity can't go to a foreign person. Make your decision based on this. (if you live in someplace like Somalia or Belarus or China, and they're a defense or security startup, maybe an argument could be made; alternative arrangements like a cash settled "phantom stock" allocation equivalent to the 0.5-2% or so you should otherwise get (over 4y) might be worthwhile instead).

Taking a below-market salary itself, if there's likely funding, isn't horrible, assuming you can live on it. Adding that you're being paid back the difference makes it good, too.