A combinatorial answer.
The right-hand side is the number of permutations of $\{0, 1, \dots, k-1\}$.
I'll let $k=5$ for concreteness.
We count the permutations in another way. Take a $5$-tuple drawn from $\{0,1,\dots,4\}$ - that is, a member of $5^5$. This is probably not a permutations - for example, it might be $00000$.
Remove anything which does not contain a $4$. That is, remove anything which can be drawn from $4^5$.
This leaves all the permutations, but also leaves things like $44444$,
so in fact we should be removing anything which can be drawn from $\{ 1, 2, 3, 4\}$ and from $\{ 0, 2, 3, 4\}$ and so on.
That is, we remove $4^5$ things $\binom{5}{1} = \binom{5}{4}$ times.
OK, we've left all the permutations, but now we've removed some things more than once: we removed $00000$ because it doesn't contain a $4$ but also because it doesn't contain a $3$, for instance.
Generally, we've removed twice anything which has two things it doesn't contain, and we've removed three times anything which has three things it doesn't contain, and so on.
We need to add them back in enough times: we need to add once anything which has two things it doesn't contain, add twice anything which has three things it doesn't contain, and so on.
Add in $3^5$ things $\binom{5}{2}$ times: namely, add in anything which does not contain a $0$ and does not contain a $1$, then add in anything which does not contain a $0$ and does not contain a $2$, then… then add in anything which does not contain a $3$ and does not contain a $4$.
We've re-added anything which has two things it doesn't contain, but we've re-added $\binom{3}{2}$ times anything which has three things it doesn't contain, re-added $\binom{4}{2}$ times anything which has four things it doesn't contain, and so on.
Repeat this procedure of adding and subtracting until we eventually finish.