Episode Details

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Eric Ries, creator of The Lean Startup and author of Incorruptible, joins us to explain why “financial gravity” pulls even the best companies away from their mission. He explains why the standard best practices founders are handed “are designed to make you lose control of your company.”

Eric published The Lean Startup 15 years ago and went on to found the Long-Term Stock Exchange. He co-founded the AI research lab Answer.AI and helped start Virgil, an AI-enabled law firm for early-stage companies. In his latest book, Incorruptible, he studies the companies that have resisted this force, from Costco to Novo Nordisk to Anthropic.

In our in-depth episode, we discuss:

* How the default “any lawful act or activity” clause in a Delaware charter quietly commits founders to maximizing shareholder value, and why lawyers rarely tell them

* The story of Sol Price, FedMart and the origins of Costco, and the “governance fortress” that has protected Costco’s $1.50 hot dog for 40 years

* The three mission protective provisions every founder can set up in a matter of weeks: becoming a PBC, adopting a director’s oath, and appointing a mission guardian

* The difference between a mission statement and a mission, and what Silicon Valley Bank’s charter revealed after its collapse

* Why “it’s always too early until it’s too late,” how to win over the roughly 25 people who must agree to a change, and why Anthropic’s Long-Term Benefit Trust has become a commercial advantage

Watch or listen now across YouTube, Apple Podcasts, Spotify, and X

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Timestamps

(0:00) Meet Eric Ries(2:14) Eric’s New Book(3:30) How Startups Are Built Today(6:20) Why Companies Self-Destruct(16:37) Who’s to Blame When Companies Fail(21:25) The Blueprint for a High-Performing Company(26:52) How Companies Protect Themselves(33:13) Building Company Ethos and Structure(46:05) Why Companies Get Bullied(50:32) When Is It Too Late to Save a Company?(55:15) The Company Eric Would Have Saved(