Elle Griffin on when Silicon Valley got rich:

As tech companies proliferated throughout Silicon Valley in the 1970s and 80s, so did their stock plans. Reagan-era tax policies further incentivized employee equity, allowing shareholders to defer tax payments until stocks were sold and reducing the taxes paid when they were. As more employees were paid in equity, more of them got rich. When Apple went public in 1980, it created 300 millionaires. When Microsoft did in 1986, 3,000 employees became millionaires. After Google’s IPO in 2004, 1,000 employees held stock worth more than $5 million. By 2007, even employees who had been at Google for a year owned about $276,000 in stock value on average.

As entrepreneurs and executives grew rich from their exits, they founded even more companies or funded them as investors. When PayPal sold in 2002, it famously made megamillionaires out of its executives and launched a new era of Silicon Valley: Peter Thiel used his riches to found Palantir and invest in Facebook, Elon Musk founded Tesla and SpaceX, Reid Hoffman founded LinkedIn, three engineers founded YouTube, and two others founded Yelp.

Employee equity programs created a new entrepreneurial class and fostered a generation of employee-owned companies.

They also led to rampant inequality.