The allocation of profits in startups, at least, feels... problematic. I was the #2 engineer hire when I was hired five years ago. Since then, we haven't become super successful -- yet -- but we're at least at breakeven. We have three engineers and we're working on a huge new project that hopefully will really grow the company. I have 1.8% equity. Sometimes when I'm working late or working on the weekend, which is of…
The key problem in your (all too common) story is that you're only waking up to reality now.
I'm guessing that like most startup employees, you were swayed by initial aggressive courtship by the founders / chief-execs, with lots of vague handwaving and hyperboles telling you that you'll definitely become a zillionaire with your "generous" equity.
After 5 years (!) of hard work you finally crunched the hard numbers, and realized your best-case exit might cover a bit of what you lose in one year of overworking yourself for a below-market salary. Your founders and managers forgot to tell you this, and probably stuck to hyperboles without divulging much real info about your equity. Far from making it easy for you to understand your equity value, they probably made it hard or impossible.
I wish your story was some dysfunctional exception, but unfortunately it seems to be the rule nowadays. In fact, I know all too many engineers who faced this sad music only after the exit, for which they got shockingly modest returns.
I can also tell you to forget about your equity being 1.8%. It's incredibly unlikely you'll actually get 1.8% of whatever monetary value your startup exits for - if any. Like most startups, certainly in your position, you are looking at more funding rounds. The investors will get additional shares, you will get diluted. Of course, the founders will tell you nothing about this, you'll just see it in your bottom line - if there ever is any.
In fact, in your place I wouldn't be so sure you actually have that 1.8% right now.
You should do one of two things:
1. Ask for a lot more equity, with transparency into the amount and valuation. 2. Start quietly looking for an employer that will pay you better, and work you less.
From your perspective, you are already fully vested. There's no reward for you taking additional risk. No sense in staying to be underpaid and overworked. Even you want to stay in startup-land, find a new startup to diversify your equity portfolio, which currently consists of one tiny slice of a risky startup.
Your current startup likely won't collapse if you leave, so you're not risking your existing equity. If your departure would be so devastating, they should give you a lot more equity.
Either way, do a clear cost-benefit analysis, and do what is right for you. Your founders are doing what's right for them, and so are the investors. Follow suite.