Build Yourself A Fortress

In 1936, John Russell Scott, the sole owner and chairman of one of the world’s most respected newspapers, The Guardian, handed over all his shares to a trust.

This meant, firstly, not having to pay any death duties (around 40%). And secondly, it meant that The Guardian could never be sold – which meant no billionaires (like Jeff Bezos buying the Washington Post), no takeovers (like Kraft Foods buying the beloved Cadbury’s, a move that worked out for the worse, according to chocolate fans everywhere), and no public shareholders to worry about pleasing (like Google or Ford have to).

And it worked. The Scott Trust is still alive and well, and The Guardian, despite facing the same challenges affecting all major newspapers these days, is still chugging along nicely, its original culture and political stance still mostly intact, safe from the usual corporate predators. Kudos to them.

This is a perfect example of what our friend Eric Ries calls building yourself a “fortress” in his new book Incorruptible: Why Good Companies Go Bad… and How Great Companies Stay Great.

Triumph attracts treachery. The bigger your pie, the more people will want a piece of it. Not all of them will be well-intentioned. This could be investors, shareholders, the competition, even colleagues. People who will gladly ruin your long-term vision for the sake of short-term gains. Golden goose killers, basically.

For example, Instagram started off as a simple place for friends to share photos with one another. A narrow purpose. A clear idea of success. But soon after it sold to Meta, there came a different definition of success:

More engagement.
More advertising.
More revenue.
More shareholder value.

None of those goals are inherently bad, but they aren’t the same as Meta’s original mission to “connect the world.” The way things are going now, the mission seems to be “flood the internet with nonsensical, shallow, eye-glazing slop.

Slowly, almost imperceptibly, the company stopped asking, “Does this help people connect?” and started asking, “Does this keep people scrolling?”

This is the battle you face when you don’t have a fortress around your company. With success comes the relentless onslaught of incentives to compound that success, which are almost always coupled with a hidden compromise. 

“You could grow even bigger… if you were willing to [insert immoral, almost-illegal business practice here].”

As the Roman liked to say, ”Quis custodiet ipsos custodes?” Eric’s answer? Your fortress.

Metaphorically, a fortress is your company’s governance, the rules you nail down in advance. The framework that governs your vision, your boundaries, your principles that can never be negotiated.

The good news is, if you build your fortress early, your company will live long enough to thank you. The bad news is, it’s pretty difficult. 

It’s a royal pain, actually. It involves expensive lawyers; it might scare off potential investors, potential hires and partners, and exasperate greedy board members. You will probably have to forgo many potentially lucrative opportunities and friends in the industry.

Most people think a fortress exists to keep enemies out, but they’re more often built to protect something precious on the inside. Expand the walls of your fortress, and you may cover more ground, but you risk being able to protect it all with the same level of conviction. Know this and act accordingly.

Nobody gets to protect their vision for free.