Eric Ries: The Mistake That Costs Founders Their Companies

I had a conversation with Eric Ries, Author of The Lean Startup on his new book, Incorruptible and he says every startup carries this one risk.

Fifteen years after writing The Lean Startup, Eric Ries, Author of the book that became the gospel of building companies, he said something profound.

“The Lean Startup taught so many people how to create something worth protecting. Not how to protect it.”

Eric’s new book is called Incorruptible. Teaching founders, how to build companies that stay good, and incorruptible by design.

The book explores a critical founder dilemma, why is it that the more valuable the thing you build, the more valuable it becomes to steal from you?

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Despite this, founders are taught that once you have product market fit, once you" “make it” you’ll have all the leverage.

He calls this magical thinking and he shares how especially the best and beloved founders we know and they still got kicked out of their own company, or the company becomes a monster, a caricature of what they intended, doing the opposite of what they tried to create.

He told the story of Sol Price. Most people know him as the founder of Costco. Few know his first. Sol built a customer-first business, proved the model worked, and lost control of it anyway. Not because it failed. Because it succeeded.

This is not a one off case. It is a pattern. He touches on so case studies in the book, from Novo Nordisk, Toney Chocolonely, Cloudflare, Patagonia, Anthropic, and so much more…

At Openseed we invest in exceptional operators on day zero as first believers and one of the questions I ask founders is “What does the world look like with your solution in its perfect form?” Founders love this question, because this is the image they are building towards, and this is what often keeps them going.

But this conversation surfaced a question I don’t think day zero founders ask often enough: what is the structural integrity of your company? Not just the product, or the team.

The soul of your company.

How can you ensure you protect your original mission of your company? That image you have in your head that keeps you going even on the worst days?

When you finally raise money, when every investor on the planet is suddenly calling you, do not put the famous person who passed on day zero on your cap table just because their logo is shiny. Reward people who are aligned on protecting the soul of your company.

Also, be very discerning, because even some of the most well meaning investors can trade the soul of your company.

We must remember, as builders, there is a responsibility that comes with creation, with bringing something into the world that impacts it. It is our responsibility to protect its original intention for good, especially as it grows because incentives will push it in many directions.

I’ve been thinking about The Lean Startup the last fifteen years. I’m going to be thinking about Incorruptible for a long time. If you’re building, you should read it.

I asked Eric, “If you could change one thing about the Lean Startup, what would it be?” He responded :)

This is a reminder for everyone building, there is a responsibility that comes with creation so it is a good time to ask the question, how does what you’re building affect the world, and are you thinking about foundational guardrails to protect its soul?

Thanks for reading. 💜

Maria

P.s We have our next Stealth Founders Event HERE, join if you’re building, from exploring an idea to already built an mvp, all pre-vc. Slots are limited.