This is often what people think, but almost everyone I know at IPO'd places are at least partially vested. They want that sweet upside and for a while it works and everyone is getting rich together.

I had to work long and hard to convince a friend of mine to diversify at least half of his investments away from Shopify which was his only asset.

That doesn't conflict with the real fact that most employees have most of their equity tied up as deferred compensation that they cannot sell until it vests.

sell it short now, cover with the vested shares :)

Most companies contractually restrict employees from shorting their own stock.