[sytelus]

5-7% of your company

Where are you getting that number? My impression was that YC had very fair deal with founder equity > 30% (unless they are funding beyond angel).

Beyond that it's just risk/reward equation. If you want same income as your stable job then you are not taking risk and hence should not expect reward beyond that. Good founders rarely however expect same income as the stable job they could have gotten because they strongly believe in their vision and success and are willing to bet everything they have. That's the first requirement to be founder, IMO. Nearly every successful founders from Bill Gates to Elon Musk have showed this most important characteristics. BTW, lest you think Bill Gates was just another college dropout with nothing to loose, consider the fact that dropouts are usually at great schools, have spent lots of time, money and effort to get there and a suddenly giving up all that to chase some idea is significant risk taking. Even to this day, Elon Musk had been willing to bet every single penny he had on SpaceX. Without this singular characteristic, your chance of becoming successful founder is very low.

[cookiecaper]

You're still taking significant risk if you get paid market or near-market rates when you start your company. You've put your name on the line, you've committed yourself to providing a product and running a company, with all the difficulties it entails.

I understand the impulse to have founders prove their commitment by living as paupers, but I just don't think it's a good way to judge the competence of an investment. I think there are other meters for passion that are more accurate than "Yes, I'm willing to take a 50-70% pay cut".