Eric Ries on Why Good Companies Go Bad,
and How to Build One That Won’t

The creator of the Lean Startup spent more than a decade helping founders build things faster. Now he’s asking a harder question: how do you build something that lasts without losing its soul?

In this episode of FOMO Sapiens, Patrick McGinnis welcomes Eric Ries, creator of the Lean Startup method and author of the New York Times bestseller The Lean Startup, to discuss his new book, Incorruptible: Why Good Companies Go Bad and How Great Companies Stay Great, out May 26, 2026. Rather than writing the sequel everyone expected, Eric spent years digging into one of the most persistent and underexamined problems in business: why do companies founded with genuine conviction so reliably drift toward extractive, short-term behavior — even when the people inside them never wanted that outcome?

His answer is structural, not moral. And it changes everything about how founders should think about building.

The conversation covers:

• Why corporate corruption is not primarily an ethics problem but a design problem — and why waiting until your company is successful to fix the governance is already too late
• The mystery of the golden goose: why the financial system has built a gravitational field that pulls organizations away from value creation and toward value extraction, regardless of founder intent
• What Costco, Patagonia, and H-E-B have in common — and why it’s not what conventional governance frameworks would predict
• The concept of shareholder primacy: where it came from, why it has no democratic legitimacy, and why most builders already disagree with it but feel they can’t say so out loud
• Why AI is an amplifier of existing problems — making extractive business models more efficient, not more ethical
• The case for a director’s oath, modeled on the Hippocratic oath, as a practical tool for protecting the mission at the board level
• Why the normative consensus around bad governance only holds because everyone assumes everyone else agrees — and what happens when builders start saying otherwise.

Patrick and Eric also get into the Panera charged lemonade story, the transformation of VC board members from bold contrarians to defensive bureaucrats, and what it would actually look like to build a market system that rewarded value creation rather than just rewarding the appearance of it.him through exactly what a practice could look like given his specific pain points — self-doubt, distraction, and a lot of FOMO.

Meet Eric Ries:

Eric Ries is the creator of the Lean Startup method and the author of the New York Times bestseller The Lean Startup, which has sold over one million copies and been translated into more than thirty languages. His subsequent books include The Leader’s Guide and The Startup Way.

As a founder, he has put his ideas into practice through the Long-Term Stock Exchange (LTSE), Answer.AI, Virgil, the Lean Startup Co., and IMVU, where the Lean Startup method was first developed. He has served as an entrepreneur-in-residence at Harvard Business School and IDEO, and has advised organizations ranging from early-stage startups to General Electric.

He hosts The Eric Ries Show and lives in the San Francisco Bay Area with his wife and three children. His new book, Incorruptible: Why Good Companies Go Bad and How Great Companies Stay Great, is out May 26, 2026. Find him at incorruptible.co.