Is it just me, or does the rhetoric from FSF often times border on spiteful? Snake oil salesman? Come on, guys. You're not going to win over sensible people with this kind of attack.

Occasionally, when something is designed better than any other comparable device, you have to pay to use it. In this case, you pay by following a few of their rules.

FSF claims to be about choice. Well, I exercise my choice by choosing to buy the phone that I prefer.

Here's why you do a DE C-corp: it gives you the most flexibility and the most certainty of outcome. Only C corps can have different classes of stock (a necessity for the preferred stock that VCs prefer), and DE is the best because they provide very wide latitude to management and have a great and well-understood corporate legal system with lots of caselaw. This means that everyone knows what the rules of engagement are going in, and the judges in the Chancery Court (if it ever gets that far) know what they're doing.

An example: when I was in VC, we negotiated a term sheet with a non-DE C-corp. The term sheet was accepted, and we drafted the amended and restated articles, investors rights agreement, blah blah. But, when we filed the amended articles with the non-DE Secretary of State, the SOS office rejected them. We had negotiated a voting structure that offended this state's rules for voting vis a vis ownership. This held back closing for months, as we had to re-incorporate in DE, and tens of thousands extra in legal fees. In DE, never would have been a problem. And because in VC, almost everything is DE, it never occurred to us to think that the SOS office would reject the Articles.

It's pretty typical to have health benefits but no 401k. You should be getting roughly market-rate compensation at a funded startup though; that's why they have funding. If you want big stock grants, you need to take big risks, i.e. work for little or no salary.

Edit: One more thing that I want to add since I've seen many friends get burned or disillusioned by this: you should assume that the only thing you'll get out of a startup is the cash you're paid and the experience of having worked there. Very few early employees cash out with enough that they never have to work again: the ones I know all fall into 3 categories:

1.) They founded the company.

2.) The company went public and became a household name.

3.) They joined early and rose really high, i.e. VP level.

The vast majority of early startup employees don't fit these categories: either their company is acquired in the $40M range and they end up with $3K (true story), or their equity is diluted by multiple successive funding rounds so that they end up owning a tiny fraction of their initial equity stake (also a true story), or the company goes bust and their equity is worth nothing (yeah, that's me). If you go in expecting a job where you'll learn things and hopefully build something cool, then any massive payday is just gravy. If you go in expecting a massive payday, you'll probably be disappointed.

Lock your doors! ...Sew up your pockets! This has to stop, before Jobs has DRM technology dating our women.

/yeah, I'm still getting an iPhone today. //hoping that in two years there will be other competitors who are more open and match the iPhone's quality