Eric Ries discusses his new book 'Incorruptible,' which explores why companies lose their way and how to build organizations that maintain their mission and values over the long term. He argues that success often becomes a liability, and founders must proactively implement governance structures—like public benefit corporations and mission guardians—to protect their companies from internal and external pressures.
Summarized by Podsumo
Only 20% of founders remain CEO three years after going public; many are ousted despite strong performance, often due to governance structures that prioritize shareholder value over mission.
Eric introduces 'harder is easier'—a principle that embracing principled decision-making upfront builds trust, reduces friction, and yields long-term competitive advantages.
The story of Cloudflare illustrates how a company's commitment to mission (e.g., making a better internet) led to a costly but ultimately rewarding decision to give away encryption for free, boosting trust and growth.
Eric recommends that founders adopt a Public Benefit Corporation (PBC) filing, which is a simple two-page document that legally enshrines a company's purpose beyond profit maximization.
The Anthropic case shows how a mission guardian (a long-term benefit trust) can protect a company from short-term pressures, enabling it to turn down lucrative but misaligned opportunities.
"The most important question about how to protect a product is not what protections it needs, but when those protections need to be enacted. And it's basically like that old proverb about the best time to plant a tree was 40 years ago, but the next best time is now—it is always too early until it's too late."
"Trustworthiness is the most underrated asset in all of business. And the things that create trustworthiness by definition stack rank to the bottom if we do it by ROI because doing the right thing has intangible rewards but tangible costs."
"If you don't get this right, no other decision you make about your company will matter for the long term because you're not going to be the one making it."