Would you even want to work for a company for whom a failed startup is a negative?

It's highly culture-dependent. In Silicon Valley it's generally not considered a negative.

Precisely. My dad is a typical executive at a big company and the consensus still seems to be that startups are not as "legitimate" as, say, working at Morgan Stanley. We argue about it a lot.

This attitude increases exponentially the further removed from Silicon Valley you are & is pretty much the status quo in Europe.