substack.com

How to build a company that withstands any era | Eric Ries, Lean Startup author

2026-05-10 · 12:03 UTC ·Lenny's Newsletter ·5 min read

Brief

Eric Ries, author of The Lean Startup and now Incorruptible, argues that durable companies are built by legally and structurally protecting the mission that creates their economic value. Speaking on Lenny Rachitsky’s podcast (episode ~1:39:22), Ries cites the empirical problem that roughly 80% of venture‑backed founders are ousted within three years of an IPO (only ~20% remain CEO), and attributes much of that churn to “financial gravity” — the predictable drift from original mission toward short‑term metrics. His remedies are practical: adopt mission‑protecting governance (examples include Anthropic, Costco, Novo Nordisk), consider public‑benefit/B‑corp style charters, and file a simple two‑page Delaware document to lock in purpose. Ries frames these as complements to Lean Startup methods — continuous innovation plus governance that prevents success from becoming the company’s undoing.

Why it matters

Eric Ries, author of The Lean Startup and new book Incorruptible, told Lenny Rachitsky (podcast posted May 10, 2026) that most successful companies are undone by failing to legally protect the mission that created their long‑term value.

Key details

  • Ries highlights a stark governance outcome: only ~20% of founders remain CEO three years after their company goes public (i.e., roughly 80% are replaced within three years of IPO).
  • He recommends concrete governance fixes — including a simple, two‑page Delaware filing and mission‑protecting charters used by companies like Anthropic, Costco, and Novo Nordisk (public benefit/B‑corp style protections) — to lock in long‑term purpose.
  • Ries names “financial gravity” as the mechanism that converts success into mediocrity and argues that mission‑aligned governance (not just mission statements) materially reduces that risk and accelerates long‑term performance.
Cleaned source text

Listen now | The Lean Startup author on why most mission-driven companies are just mission-“hopeful,” why only 20% of founders remain CEO three years post-IPO, and the Delaware filing every founder should make

͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­͏ ­

Forwarded this email? Subscribe here for more

[ | | | Lenny's Podcast: Product | Ca…

How to build a company that w…

Preview

0:00| | []( )| | 1:39:22| | | %26stroke%3Dnone%26strokeWidth%3D3.6)| ]( )

Listen now

How to build a company that withstands any era | Eric Ries, Lean Startup author

The Lean Startup author on why most mission-driven companies are just mission-“hopeful,” why only 20% of founders remain CEO three years post-IPO, and the Delaware filing every founder should make

Lenny Rachitsky

May 10| | | ∙| | Preview

READ IN APP

Eric Ries is the author of _The Lean Startup_ , a book that reshaped how a generation of founders think about building companies. His new book, _Incorruptible_ , explains how successful companies are destroyed by failing to protect what makes them valuable, and how to change it.

Listen onYouTube, Spotify, and Apple Podcasts

In our in-depth conversation, we discuss:

1. Why 80% of venture-backed founders are ousted within three years of going public

2. The governance structures that protect companies like Anthropic, Costco, and Novo Nordisk

3. The simple legal filing that takes two pages and could save your company

4. Financial gravity: why successful companies predictably get corrupted into mediocrity

5. Why mission-aligned companies like Anthropic reap major benefits from protecting their mission through governance

6. Why success won’t protect you—it instead makes you a bigger target

WorkOS —Make your app enterprise-ready, with SSO, SCIM, RBAC, and more

Vanta —Automate compliance, manage risk, and accelerate trust with AI

Where to find Eric Ries:

X: https://x.com/ericries

LinkedIn: https://www.linkedin.com/in/eries

Website: https://www.incorruptible.co

Newsletter: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://news.theleanstartup.com/

Podcast:⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ https://ericriesshow.com

YouTube: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://www.youtube.com/@theericriesshow⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠

Referenced:

Reflections on a movement | Eric Ries (creator of the Lean Startup methodology): https://www.lennysnewsletter.com/p/reflections-on-a-movement-eric-ries

How Anthropic’s product team moves faster than anyone else | Cat Wu (Head of Product, Claude Code): https://www.lennysnewsletter.com/p/how-anthropics-product-team-moves

Quibi: https://en.wikipedia.org/wiki/Quibi

Vital Farms: https://vitalfarms.com

BlackRock: https://www.blackrock.com

Costco: https://www.costco.com

Cloudflare: https://www.cloudflare.com

“The best time to plant a tree” quote: https://quoteinvestigator.com/2021/12/29/plant-tree

Whole Foods: http://wholefoodsmarket.com

Marie Krogh: https://en.wikipedia.org/wiki/Marie_Krogh

August Krogh: https://en.wikipedia.org/wiki/August_Krogh

Martin Shkreli: https://en.wikipedia.org/wiki/Martin_Shkreli

Novo Nordisk: https://www.novonordisk.com

Zeiss: https://www.zeiss.com

Philip Morris: https://www.philipmorrisusa.com

Vectura: https://en.wikipedia.org/wiki/Vectura

Matthew Prince on X: https://x.com/eastdakota

“AI Will Break the Internet”—Cloudflare CEO’s Big Prediction: https://www.ericriesshow.com/matthew-prince-ai

Andrew Mason on LinkedIn: https://www.linkedin.com/in/andrewmason

Groupon: https://www.groupon.com

Steve Jobs: https://en.wikipedia.org/wiki/Steve_Jobs

Yvon Chouinard: https://en.wikipedia.org/wiki/Yvon_Chouinard

Patagonia: https://www.patagonia.com

Unilever: https://en.wikipedia.org/wiki/Unilever

Johnson & Johnson: https://www.jnj.com

Peter Drucker: https://en.wikipedia.org/wiki/Peter_Drucker

How the Former U.S. CTO Built a $3B Healthcare Company Powered by Love | Todd Park: https://www.ericriesshow.com/how-the-former-us-cto-built-a-3b-healthcare-company-powered-by-love-todd-park

Devoted Health: https://www.devoted.com

Don’t be evil: https://en.wikipedia.org/wiki/Don%27t_be_evil

Silicon Valley_ on HBO Max: https://www.hbomax.com/shows/silicon-valley/b4583939-e39f-4b5c-822d-5b6cc186172d

Adam Smith: https://en.wikipedia.org/wiki/Adam_Smith

Understanding public benefit corporations: Profit with a purpose: https://www.britannica.com/money/what-is-a-public-benefit-corporation

B Corp: https://www.bcorporation.net

Anthropic: https://www.anthropic.com

Clayton Christensen: https://en.wikipedia.org/wiki/Clayton_Christensen

Howard Schultz on LinkedIn: https://www.linkedin.com/in/howardschultz

HEB: https://www.heb.com

Mary Parker Follett: https://en.wikipedia.org/wiki/Mary_Parker_Follett

Elon Musk on X: https://x.com/elonmusk

Sam Altman on X: https://x.com/sama

Dario Amodei on X: https://x.com/DarioAmodei

Daniela Amodei on LinkedIn: https://www.linkedin.com/in/daniela-amodei-790bb22a

Kobayashi Maru: https://en.wikipedia.org/wiki/Kobayashi_Maru

Mark Zuckerberg: https://en.wikipedia.org/wiki/Mark_Zuckerberg

Larry Page: https://en.wikipedia.org/wiki/Larry_Page

Sergey Brin: https://en.wikipedia.org/wiki/Sergey_Brin

Rome Conference on AI, Ethics, and Governance: https://romeai.wsgrevents.com

OpenAI: https://openai.com