I think this applies in most cases. That said, many more startups are now bootstrapped, and don't go on to raise beyond a Seed or Series A, if at all.
If you're an early employee at one of those startups (with a very low strike price), and know that the company has a strong balance sheet, I would early exercise to lock in the long-term capital gains tax rate.
This is even more true if the startup has novel IP, which could be worth a healthy sum even if the business were to go kaput.
Also, as others have said, if startups weren't lucrative, VC as an asset class wouldn't exist at all. It's rare, but making millions as an early employee is something that definitely happens.
If you're an early employee at one of those startups (with a very low strike price), and know that the company has a strong balance sheet, I would early exercise to lock in the long-term capital gains tax rate.
This is even more true if the startup has novel IP, which could be worth a healthy sum even if the business were to go kaput.
Also, as others have said, if startups weren't lucrative, VC as an asset class wouldn't exist at all. It's rare, but making millions as an early employee is something that definitely happens.