Episode SummaryEric Ries is the author of The Lean Startup and The Startup Way, and the founder of IMVU and the Long-Term Stock Exchange. His new book, Incorruptible, examines why companies drift from their mission once investors and boards take over, and what founders and early investors can do to prevent it. In this episode, Cheryl and Maxine unpack what Eric calls "financial gravity," the force that pulls companies toward extractive, value-destroying behavior even when everyone believes they're pursuing profit. Eric explains why many widely taught governance best practices are actually shareholder-value destroying, and why the earliest stage of a company is the easiest time to build in protections against this drift. You'll also hear Eric break down the "spiritual holding company" structure, using Novo Nordisk's century-old nonprofit foundation as an example of why mission-guardian structures make companies far more likely to survive long term. The conversation covers why founders get talked out of protective provisions until it's suddenly too late, and Eric shares the real story of a startup that took a million dollars from Purdue Pharma to push opioids to doctors, and why it destroyed the company. He closes with his Big Cojones moment: a board meeting early in his career where he expected to be fired for refusing to abandon his unconventional methods, and the lesson that "harder is easier" when you stand for something you believe in. Time Stamps00:00 – Intro 04:10 – Eric's first investment: putting his own money into IMVU's friends and family round 09:15 – From Lean Startup to Incorruptible: why it's always felt like one continuous project to Eric 17:40 – The tortilla company, private equity, and why "pricing power" explains so much bad behavior 21:30 – Why so-called governance best practices are often value destroying 25:50 – Naming the problem: financial gravity and why our grandparents would have called it corruption 30:20 – What founders and early investors can actually do at the earliest stage 36:45 – The Olympic athlete analogy: why protective structures only work if built in early 41:10 – The spiritual holding company explained through Novo Nordisk's origin story 48:30 – Why companies rated for "good governance" have underperformed since 2008 52:15 – The Purdue Pharma story and how a million dollars destroyed a company 58:40 – Big Cojones moment: the board meeting Eric thought would get him fired Sponsors:First Cheque is supported by our wonderful sponsors:Deel: Founders scale faster on Deel. 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We headhunt highly skilled talent from the Philippines and South Africa with full transparency on where every dollar goes, so your team is paid fairly and fully focused on your business. As a Day One listener, you’ll receive a free team audit to identify where offshore talent could move the needle in your business, plus 20% off your first hire. Deel x PX_Script 1 Pear Tree If you're a founder or operator trying to scale, here's the reality — Australian hiring is getting harder, salaries are at record highs, and the talent you need is increasingly out of reach. The best operators are quietly building offshore teams of engineers, marketers, accountants and analysts at a fraction of the cost. Pear Tree does it differently. We headhunt highly skilled talent from the Philippines and South Africa with full transparency on where every dollar goes, so your team is paid fairly and fully focused on your business. As a Day One listener, you’ll receive a free team audit to identify where offshore talent could move the needle in your business, plus 20% off your first hire. This podcast uses the following third-party services for analysis: Podtrac - https://analytics.podtrac.com/privacy-policy-gdrp Spotify Ad Analytics - https://www.spotify.com/us/legal/ad-analytics-privacy-policy/
