[eries]

I cover this topic extensively in the book. I think the fact that founders are increasingly turning to the political solution of "despotic emperor for life" tells you more about how bad standard governance is than anything else. I think vesting this power in a singular person or small group of people has all the downsides you'd expect from studying history. In the psychology literature, they literally have a name for "hubris syndrome." That is a mental illness that sets in when people have too much power.

In the book, I make the case for what I call constitutional governance, which I see as a third way in between standard governance and founder-controlled governance. I think it is both more effective and more long-term. After all, a company that is tied to the human lifespan has a built-in expiration date.

[nicksbg]

Thanks for reply Eric! I agree, and the problem is in the same way as with countries. Sure, you may have good leader and stability while the founder is alive - but once he goes, everything is ready to go up in flames.

The various gravitational forces within company eventually pull the company apart.

As you said, third way governance is really the key. At the end of the day founders in some cases should become chairman, to ensure that everything is functioning as set by constitution. Going into retirement and enjoying pension/stock options should be more common.