Rates are important, but what's even more important is that your rate is an instrument that allows you to slide without stops from 'unemployed' to 'full timer' (and beyond for the workaholics). You get to determine exactly how much you work and how much free time you have if you have a valuable marketable skill.
The most interesting bit is how fast his time has increased in value, four short years ago he was still employed at some reasonably (by SV standards) low monthly wage working insane hours and now he's making as much or more per week as most of his former colleagues make per year.
That's a pretty good raise. And it did not have the risks associated with doing an all-out start-up associated with it either he's applying the lessons he learned running his own smaller business to larger businesses that are prepared to pay for that knowledge.