Isn't that the point of equity compensation? I don't care about owning a percentage of the company - that just sounds complicated. I care about converting it into cash later. To compensate for the small chance that will be able to happen, you better make it seem like a lot more cash than the alternative cash compensation you're offering. The upside to you is that you don't have to pay that bundle of cash for a while, and you only have to pay it if you have it. And not you personally, but all investors indirectly.