I'm not taking it personally, but really, you need to make it clear that the student's time is valued. Equity is perfectly fine compensation, especially if it's clear that the student is going to be considered for a full-time job.
Just put it into the ad next time, and it might look less like you're trying to screw the students over.
You make a valid point above. We are not looking to screw people out of money. We were hoping to offer someone a good experience, and begin line up future employees for when we could afford to pay them.
We apologies, we appear to be poorer than the students :)