For the employees of a VC backed company, the liquidation preference of its investors is cage - a cage that you can't break out of unless you become a billion dollar business.
This is a wonderful story and I have such enormous respect for Sahil for sticking it out. I wonder if the story would be different if the investors didn't give up the keys to cage.
Here's a challenge to VCs: do you really want to strangle us if we turn out not to be the billion dollar business you hoped for? And if you don't want to strangle us, put your money where your mouth is and do away with the preference. Better still, buy common stock :)