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I think it's intriguing, and love that they're trying this out. It does seem to imply the following to make this work, as the blog post didn't delve into the dynamics:

a) Salary might have to be at least market average, if not above-market-average, or offer a very compelling reason to the contrary;

b) To provide a means to differentiate experience or equity ownership, perhaps a bonus or profit sharing could be implemented, which may or may not be transparent to the entire company;

c) Implies junior staff can't be hired without at least some people feeling said junior staff are getting a bit of a free ride.

If your team is small, and you can afford to hire great mid/senior talent, I could see this working and increasing team cohesiveness. I'm not sure how to handle point (c) above in this structure as the company grows.