It's because those same software engineers have 0 financial background. It's not different than a software engineer going into a financial firm and saying "I can't believe none of these guys know how their technology works".

The most financial exposure these individuals have is reading the $Xmillion Series X funding, or $Xbillion exits that they see on TechCrunch on a daily basis. Their risk is assessed on those headlines.

From my own experience, it was naivety and manipulation.

I trusted the founder when he would make big promises for the future. He didn't bring up equity until the last moment once we already were ready to quit and join. In hindsight these are clearly common business tactics (get the person to accept before going into details), but as a young engineer I had more trust in older more experienced folks like the founder. Even when there were huge alarm bells ringing in my head, I said yes. It's hard to describe how a good salesman can have you saying yes to things you aren't comfortable with.

In the end the company crashed and burned after losing all it's founding team who all work at top companies now.

> It's hard to describe how a good salesman can have you saying yes to things you aren't comfortable with.

I recommend a book that describes some of these tricks pretty well. It helps protect me from such manipulation (some of the time):

https://www.amazon.com/Influence-Psychology-Persuasion-Rober...

Because: they're fresh out of college and haven't met anyone burned by an IPO/bubble burst & realised how that could be them.

Because being underutilized in a large company is unfulfilling. Because being a staff engineer in a large company gets you no closer to running your own business. Because you want to learn technology that you cannot yet compete for. Because options outside of large companies are limited, especially if you are unable to take large immediate financial risks.

Why not: work for a large company that can do both? Pay reasonably well with low-risk, and let you grow your technology skills + contacts?

A: those companies aren't cool & won't make you a millionaire by 35 on stock options (whereas a startup might)

Personally, because I don't like being told what to do :) If I don't have a significant amount of control I shut down, become depressed, anxious that I'm wasting my life, etc. I'm also wary of being taken advantage of. If I'm going to spend half or more my waking hours working I want to be reaping the profits. I need freedom. I've been directing product at a seed stage startup to get my bearings in the small business world but now I'm feeling antsy because I am starting to think I could be doing better on my own while having more control over my time, the products I build, the money those products earn, etc.

Pitch to some VCs then.

False choice. One does not have to live off ramen at a startup to do those things.