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The Moonshots Podcast goes behind the scenes of the world's greatest superstars, thinkers and entrepreneurs to discover the secrets to their success. We deconstruct their success from mindset to daily habits so that we can apply it to our lives. Join us as we 'learn out loud' from Elon Musk, Brene Brown to emerging talents like David Goggins.
Hello and welcome to the moonshots master series. It's episode zero two. That's right, the next one. I'm your co-host Mike Parsons. And as always I'm joined by a man of principle, Mark Pearson Freeland. Good morning. Hey, good morning, Mike. Isn't this an exciting day for you and I to be launching episode number two of the master series.
It is so good. And I think, you know, the previous master series on motivation has primed me to go into a new. Area of discovery today, mark, where are we going today? Well, if last episode, episode number one was all about money, motivation and building the foundation for you and I to really get inspired day to day and go out and achieve our goals and objectives today.
Mike is all about digging down into the first principles and first principle [00:01:00] thinking, which I think is fair to say, Mike, one of the most consistent ways of thinking, or maybe perhaps the, the DNA foundational way of thinking across a lot of our entrepreneurs and superstars that you and I are running.
It's incredible. Like after 140 episodes of the moonshots podcast, we can sit here on the master series and say, first principle thinking is a great way to solve problems. It's a great way to make better decisions because the proof mark, the evidence mark is there for the taking so many amazing people from Aristotle to Elon Musk and everyone in between is using first principles thinking to help them navigate.
All the complexity in the world and to come up with products or perhaps even companies that have incredible impact. And if it's not building a company, maybe it is your [00:02:00] thinking, your book, your work, whatever it is, first principles thinking is something we know for sure superstars, the moonshot is of the universe are using.
So it is our job to bring it to you, our listeners and boy mark today's show is going to be huge. Yeah, you're right. And actually that's not really a superlative mic, you know, you've just referenced a huge amount of individuals using it to create companies or just to problem solve. But the truth is it really is that beneficial and that practice, doesn't it, it's such a way of thinking to make well-informed decisions.
I don't think we could really oversell it enough because it really, really is that substantial as a way of thinking. So together today in this show, mark and I did a breakdown first principles, which is a way of decoding complex problems and to like reducing them down into their basic elements. So [00:03:00] imagine that you have to tear everything apart and then you kind of rebuild fresh, creative, innovative solutions from that.
So rather than just jumping to conclusions, you have to kind of like Lego. You have to pull it all apart and then rebuild it with like new inspiration. That's what first principles thinking is we're going to decode it. We're going to go on our crazy journey. First of all, part one of the show we're going to go into studying.
I would say some of the most inspirational people and thinking around first principles, and then we're going to keep going. We're going to go a level deeper. We're going to break down three case studies of first principles thinking. And in that we're going to hear from some of our classics, like Elon Musk, Peter teal, and we're going to hear for some brand new moonshot experts, some superstars that use first principles thinking.
And lastly, it wouldn't be a master series if we weren't building this into a daily habit, a daily routine. [00:04:00] So we're going to go right into the tools that you can use every single day to build that habit, to build that Ru teen, no wonder we call this a master series map. That just sounds big. Yeah, it's pretty big.
And I remember episode one, creating daily habits of motivation for me was such a substantial way of. Trying to accomplish and compartmentalize everything that we had heard from you know, we had James clear, we had Gary V lady Gaga or within the motivation show. And to end on understanding how I myself can go out and be that 1% better every day.
It helped me Mike understand how I can put some of this, these, this way of thinking and this way of being inspired into practice. And I think what you and I have in store for our listeners today is a very similar process of breaking it down and inspiring us to think from a first principle perspective from today, onwards.[00:05:00]
I couldn't agree more. So buckling get your cup of tea or a cup of coffee. Ready? This is going to be 19 minute masterclass on first principles thinking. And remember, because it sounds master series. You may want to pause this. You might want to go to moonshots.io login for your membership. Get all of the show notes, the transcripts, all of the links that we're going to mention.
Cause there's going to be deep and comprehensive. All right, so now you're ready. You're at the very moment to press the button. I tell you what, Mike, I'm going to press the button. I'm going to tear into the first clip, which is from a guy called Gary Tan, who we quite, quite like on moonshots, very fond of Gary.
And he is going to tell us about challenging your preconceived notions. Yeah. You brush your teeth. You eat cereal. You go to school. Do, as you're told, sit up straight show up on time. Don't talk back. Be a good person. Fit [00:06:00] in don't make waves, stay in your lane. The nail that sticks out is hammer down, but isn't that the problem, a whole system, a whole society, a whole civilization dedicated to telling you how to live and what to do and how to think.
But there is a way to break out first principles thinking, can you start from what you are? Absolutely sure is true. Can you have direct experience with a thing or get more experience such that you can make a more well-informed decision or guess as to how something works or the state of a particular thing?
Remember where we started the classroom, the workplace, these places where we sometimes spend years and years of our lives. Are designed to teach you to stay in the box that you live in. You learn the history, you learn how it's been done, and then you were programmed to believe that that is how they will be for forever.
And this is where first principles thinking [00:07:00] can help you because in contrast, you will end up challenging the preconceived notions and the thinking by analogy that the rest of the world has imposed on us. There are ways you can make something new and different, and it starts with three things. I think you need.
Number one is curiosity. Number two is empathy. And three strangely is actually serenity. Those are the three key things that will allow you to start on your path towards first principles thinking, oh, were off. We are on the train to digging into first principles, thinking and understanding how we can learn and practice it ourselves.
What a great starter for us to kind of whet our appetite. He kind of nailed it, right? He said like, look, if you want to do out of, out of the box, thinking, this is where you go, first principles, you apply first principles thinking, and you will be able to think in a [00:08:00] contrary and revolutionary way, as opposed to just doing what everybody else is doing.
And I mean, that's really, I mean, if you think about it, everybody says, well, let's do some out of the box thinking, but how often do they break it down and build the steps so that you can do it? Like a routine, like a like working out at the gym, right? What I am so excited about is you and I are going to actually build that habit, build that routine together today on this show.
What I think is great. As we begin the show on first principles to try and break it down and understand it is Gary's reminder to us that you are a product of the way that you're educated, maybe your career and ends up happening is you follow some pretty similar thinking to others, maybe your teachers, your colleagues, and so on, but also to yourself.
And it reminds me Mike, of, of our Adam Grant [00:09:00] show on the moon moonshot show about thinking better and thinking again and thinking differently to others. As I begin my journey or continue my journey to first principles thinking, that's what I'm going to take with me. The idea that I can challenge the preconceptions that I might have about problem or a solution and practicing first principles to get to a better decision at the end is what I'm going to try and do as we go through today.
And I think the context in which first principles work so well is that we are full of cognitive bias. And what I mean by that is we have so many bad habits when it comes to how we think. For example, I've got a list here, mark lack of some cognitive biases, anchors string bar bias is when people are over-reliant on the first piece of it information they're here, [00:10:00] availability, heuristic.
This is people over estimating the importance of information that is available to them. They might not have all the information, bandwagon effect, confirmation bias, information bias, outcome bias, overconfidence, recency bias. I mean placebo effect. I mean, I can go on and on. These are all basically. The reasons why we have wishful thinking or lazy thinking, incomplete thinking we make better.
We make worse decisions when we do that. So with that, knowing that we have the habit as human beings to do that, we can build a muscle that is a first principles thinking. And I think this is so exciting because we're presented with so much information. But if we can build this discipline of thinking right.
Of, of really analyzing in a objective way, in a rigorous way, not only will we be able to solve [00:11:00] problems, but we'll make better decisions about what should happen next. And I'm super excited about that. How about you, mark? I think that's, that's a good breakdown and I love these cognitive biases that you were, you were referencing because it's so hard to, as you know, the old saying, see the woods through the trees sometimes.
Yeah. There are so many moments when your natural bias will kick in and you'll say, oh, well my, that colleague or that customer. Has requested something, but that reminds me of a time when somebody else requested the same thing and it frustrated me then. So maybe my natural instinct is to be a bit frustrated again, because I assume I know it's going to end, which is totally unfair.
Isn't it? It's unfair to put that onto somebody else and put that into the same situation because the truth is it is a totally different thing. And it is those biases, as you were saying, that's getting in the way of us being able to analyze a situation correctly [00:12:00] and mess around without having, you know, mental models in place without having first principles thinking as a kind of first stop on the bus to try to make those better decisions and solve problems a little bit better.
You are going to naturally fall into that consistent almost bad habit of thinking in the wrong way. I think that that's a nice way of breaking it down. And to build on that, I would say to avoid the wrong way of thinking, we can study the grades who have thought correctly. And one of the greatest living ambassadors for first principles thinking is Elon Musk.
But here's the crazy thing. It ain't anything new mark. And we've talked about, you know, Charlie Munger, Einstein using first principles thinking goes way, way, way back. You can go right back in history for millennia. And there have been people boiling things down to their [00:13:00] fundamental truths. So let's now listen to this story act, let's get into the history of first principles.
Thinking, thinking from first principles is not new. It's a method of thinking that's been utilized for over 2000 years, first popularized by Aristotle when he defined it as the first basis from which a thing is known as resurfaced in popularity. After Elon Musk attributed his may successes to this style of thinking, I have some of that secret sauce.
Can we put it into our education system? Can someone learn from you? It is truly amazing what you've done. I think I do think there's a good, a good framework for thinking is physics. You know, the sort of first principles reasoning, but generally what I mean by that is boil things down to the fundamental truths and reason up from there, as opposed to reasoning by analogy throughout our lives.
We are taught to reason from analogy. Our schooling system [00:14:00] largely revolves around this concept. During school, we were rewarded for how well we could follow instructions. We were told what we should read and which exercises to do for her. This form of education did not inspire independent and original thinking, but instead encouraged us to follow and not question that which was already established.
We then live our lives thinking in this limited way, first principles thinking us that we break down our assumptions and question them in the same way as the scientists would. Once you separate facts from assumptions, you can start to build something amazing. Most problems do not require breaking down to the most basic level, going a few levels deeper than others is usually enough to give you the upper hand going a level deeper than others.
I mean, this is a big takeout, Mike, if you want to. Separate yourself from [00:15:00] analogy thinking, which is a concept we're going to dig into and revisit a couple of times in the show today. If you can separate yourself away from that analogous thinking and really boil it down as Aristotle would say into the first basis, from which a thing is known, you can stand out.
And I think that breakdown from the realized man is, is quite a handy snapshot of first principles thinking, what did you think? You know, I'm, I'm, I'm almost going back to trying to catch the bad habits. I mentioned the bias before, but, but I'm, I'm, I'm sort of dwelling in what he was referring to as this reasoning from analogy.
And I'm trying to really capture that. I'm almost deliberately, like before I get all excited about all the new possibilities that come from first principles, I'm almost like how, what do I have to stop doing? And what do I need to do more of? And I, [00:16:00] I wonder my question for you is what do you think there's reasoning, reasoning from analogy is like, what is, yes.
So for me, I think it's coming back to a shared experience. So it's familiar ground. If you put your, let me, let me see. This is where my mind goes. Mike, tell me if I'm taking us on too much of a tangent away from first principle thinking, but if I was to touch a hot pan and I get burned, my reaction to a hot pan, next time will be pretty similar.
I'll be thinking, oh, no, I don't want to touch that because it's going to be hot. I think reasoning from analogy is a similar concept and analogy is like something. So that, that hot pot is like the hot pot. I touched last time where I got burned. When I think about analogist thinking and thinking from analogy with regards to problem solving, I might look at a, an issue or a challenge or a problem that I have in front of me.
And [00:17:00] I'll try and adopt a cookie cutter approach. I'll try and apply this same level of thinking the same behavior that perhaps I've used in a previous situation. A previous problem. Yes. So what we're talking about is when we look for solutions, we often look to see the problem that we usually see and come up with the solutions that we usually recommend.
Would that be, do you think that's a good breakdown? Yeah, yeah, yeah, exactly. My brain would recommend a certain reaction based on what I've perhaps seen or done in the past. And what, what the problem, if you're trying to build something new, But yet you're looking for the same old characteristics of the problem and solving it with the conventional approach.
You're going to get a very unremarkable result. Exactly. Because it's not the right model or behavior to follow you. It's [00:18:00] not that black and white. Is it just because I've burned my hand on a, on a hotpot doesn't mean I should follow the same level of thinking when I'm trying to understand or work with a colleague or maybe create a new vision.
Well, well, let's, let's go further and just use the example of building a business. If you look at the market and look for the same problems, everyone else's solving and to solve them in a similar way, how can you expect a remarkable outcome? You can't can't, you know, you might be able to A similar product or a similar business reaction in the market, you know, maybe you'll, you'll sell it.
If you've made a toaster and it's a copy, a carbon copy of a toaster that's already out there. Maybe you'll see similar-ish sales, but you're not going to innovate. You're not creating anything new in that space are you, which means you won't get, if you don't create a remarkable solution, you won't get a [00:19:00] remarkable financial return that's for sure.
But the other thing is if you come with something that is very similar to everything else, the, the, the bias to the status quo of the. Customers be them enterprise customers or consumers. Well, they will think of the switching cost. Well, that's a toaster, but it's not that much better than mine and I can't really be bothered.
And so what I think the real push off here is if you want to do something remarkable, something wildly different and have the results, the, the fame, the fortune, or I'm hoping the sense of fulfillment and satisfaction of having had impact in the world. You cannot afford to look at the same problems in the same way to provide the same solutions as everybody else, because you will have diminishing returns.
If you want to have impact, you got to do something different. If you want to do something different, it's all [00:20:00] at first principles, wouldn't you say? I think that's the real DNA. Like Aristotle says, it's the first basis. If you pre-drill it all the way down to its DNA and its foundation, that's the way you've got to tackle a problem much as, you know, creating a new business.
But it's funny, Mike, as you, as you say, all of this, I'm thinking, of course, this makes so much sense, but then I'm reminded of those two clips we've just heard from Gaetan and the realized man there, my brain isn't wired that way right now. It's going into that analogy. She thinking isn't it, it's falling back into almost a default mode where I think, okay, well, if I'm going to create you know, a new business, like a, like a, a car sharing app, my initial reaction will think of it.
Okay. Well maybe I'll look at Uber and see what they've done. Maybe I'll try and improve what they're doing, but that's just going to again, be a calm or cookie cutter approach. It certainly is, but the good thing is [00:21:00] we do not have to be lost in the wilderness mark because we have none other than Mr. Ilan Musk telling us the best way to create something new.
And then th th the final thing is, is to sort of is don't, don't just follow the trend. So you may have heard me say that it's good to think in terms of the physics approach, the first principles which is rather than reasoning by analogy, you boil things down to the most fundamental truth. So you can imagine, and you reason up from there, and this is a good way to figure out if, if something really makes sense or if it's just what everybody else is doing.
It's hard to think that way you can't think that way about everything takes a lot of effort. But if you're trying to do something new, it's the best way to think. And that framework. But by physicists to figure out counterintuitive things [00:22:00] like quantum mechanics. So it's really a powerful, powerful method.
I mean, if Mr. Elon Musk physicists, we've heard Aristotle, we even touched upon in Mike, you know, Albert Einstein and Shane Parrish episodes on the moonshot show. This really does seem to be the best way to create something new when you break it down to its first principles. Yeah. And what I think is important and why we have done this show, mark is even Ilan says it ain't easy.
It ain't easy to do. And I mean, look, that was a great clip from his 2014 USC commencement speech. And that's quite a substantial amount of time, Mike, that was eight years. Actually, I can't remember what year we're in now. Maybe it's seven years ago. It is a bit like that. I, I'm not going to disagree.
And it's [00:23:00] amazing just that level of consistency and the focus that he's had in creating new companies, new products that are literally out of this world. And it all stems from this single way of thinking that then enables him to build both new mental models as well as a product. Yeah. And, and let's, let's just be reminding ourselves that not only have the Aristotle's, the Einstein's Charlie mongers all been using this, but this is, we are witnessing Elon Musk and entrepreneur living today, doing these things.
In real life for us to learn from, just think about it. The boring company, Neuralink open AI, Hyperloop, solar city, Tesla space X. Oh. And by the way, he did this little thing called PayPal, you know, like, come on, this is so exciting. We are [00:24:00] witnessing someone who is having this great success, great impact.
And he's telling us how he did it. And today, right now you, me mark, and all of our listeners, we're breaking it down so we can do it too. I mean, this is such a great experience, like a great moment in our lifetime where we can for sure know that we got to get into this because Ilan success is indisputable is yeah.
I mean, those are some of the most exciting companies out there. When you, I I'm for myself as maybe, well, perhaps some of our listeners when Elan Musk. Went out and reference first principles thinking. And he went on his, ask me anything page on Reddit, or just a year later after that commencement speech clip, we've just heard.
And he references first principles thinking. So consistently it is a another penny drop moment. Isn't it? And you think, wow, well, if he's doing these [00:25:00] incredible companies and he's kind of making it look, I don't want to say easy. I mean, he's certainly a productive chap. Who's, who's churning out businesses, but if he can keep himself focused and innovate in the way that he's doing, then surely we can utilize our own approaches to first principles thinking to do a similar, similar process.
I F I feel pretty inspired like from all this. Yeah. And I mean, we've got to study it and you've got to practice, practice, practice, practice, but we've got it all in front of us. Now that we have done our inspiration piece, I want to pause and say, I really encourage you as you're listening to this, to head over to moonshots.io, log into your members area, get all of the notes from this show.
There are lots of diagrams, downloadables worksheets, a full inventory of everything we've discussed. We've even got links to Elan's posts [00:26:00] on his 2015. Ask me anything on Reddit. So you can see what he says about first thinking there we've got some great resources for you to adopt this. There's so much in the world of first principles to make sure you go over to moonshots.io login, just click on the members area.
It makes sure that you get into into that because this is going to help you digest it. And do you know what? You can keep coming back to this and pause if you want, write down your notes. This is meant to be a true master class in decoding and understanding and practicing first principles. We've done the upfront mark.
We've set the scene. We're inspired, but mark, what happens? Well, I think for me, Mike, if I'm feeling I want to now know great, Elan's done it. Our Soto's talked about it. I, how do I, how do I put this into practice prior to actually figuring out to making it a daily habit? My, I [00:27:00] need to understand it that little bit more.
So help me, as we dig in to part two of the show today, help me understand principals from a couple of different angles helped me really appreciate not only the value it can bring, but also understand how I can eventually go and put it into practice. Yeah, I think this is, this is the moment isn't it? I think we have to now go deep.
We have to really decode the component parts of I was thinking and the way we're going to do that is these amazing case studies. So there's a friend of it. Elon Musk called Mr. Peter Thiel, Peter teal has had enormous success. Co-founded PayPal and Ilan did a few things. Yeah. Kind of like the first investor in Facebook and many, many, many more things.
So he has had amazing success as well. And he is also a distance, the first [00:28:00] principle thinking. So let's have a listen now to Peter till talking about doing one thing better than anybody else. The most critical thing for every startup is to be doing one thing uniquely well, better than anybody else in the world.
Technology's a fundamentally a global business. And the Greeley great technology companies are doing something significantly better than anybody else in the world. And you, you want to be in that sort of a position. I think if you're just starting a business, one of the questions that's always valuable to answer is what do you know that's true that nobody else understands or or more prosaically what what great business exists that nobody is building I am of the view that we are not living in a time of tremendous technological acceleration.
I think we've had 40 years of what is it best modest. There has been progress in computers and [00:29:00] finance in the world of bits, but not in the world of stuff. If you look at transportation, if you look at energy biotechnology any of a number of other areas of technology things have basically been stagnant at best for the last 40 years.
This is reflected in the way in which wages have not really gone up in the U S or the rest of the developed world since the early 1970s. And I think we need to think really hard why technological progress has been as as badly stalled as it has. I'm not a fatalistic about this. I think that I think that we could be doing a lot better.
I think that I think that sort of an optimistic complacency is the thing we must constantly resist. And we we must sort of have a slightly pessimistic, but very non complacent attitude, not defeatist, but just a view that we could be doing so much. I think a technological innovation involves maybe three separate things.
There's sort of a brilliant [00:30:00] breakthrough idea. There's incremental improvement and there's complex coordination. We're pretty good at the incremental improvement part. We're pretty bad on the other two. And we probably need to think really hard about the other two probably need brilliant breaks throughs in areas like biotechnology to really take it to the next level.
And we probably have a academic and university system, which rewards incremental research and doesn't reward. The brilliant scientist is working for 10 years on a single great project that such a person would never get tenure or even a PhD. And on the complex coordination side, there are a lot of things that require complex coordination.
So for example, if we're to develop next generation nuclear power technology in the U S you need to figure out ways to store the waste. You need to figure out ways to. The the plants you need to figure out all sorts of complicated ways to coordinate it with the rest of the energy system. And that's, again, something that we're extremely bad at doing.
And so I think that we need to figure out ways to [00:31:00] do better coordination and and encourage sort of brilliant scientists and technologists to be able to have a sustained runway to pursuit to their dreams, the legend, Peter teal, breaking down business ideas, improvement coordination in order to do one thing better than anyone else.
I mean, my, the thing that stood out for me as I was listening to Peter Taylor again, then is this reference to it was quite near the beginning of that clip of that talk referencing, what do you know? That's true. And obviously he then breaks that down across those there's three different principles later on or three different topics.
That's actually a question though, Mike, that I think sometimes we're quite happy to almost forget, or maybe not happy to forget, but we have a tendency to perhaps put to one side in favor of action. Yes. [00:32:00] Yeah. I think you've got like this rush to action just to be productive or you've got what he also talked about is complacency, right?
Not to do the thinking. You just like see the same old problems come up with the same old thinking if the same old solutions with very, very Poor results, right? He, I mean, what he's really tapping into, like, what's the one thing that, you know, is true that nobody else knows or create a company that doesn't exist that should exist.
Right. You know, I like how he is saying to us, whether it's this rushing to conclusions or just being a bit lazy, right. To force ourselves. And, you know, I cannot recommend his book from from one to zero. Or is it zero to one actually, you know, I should look that up, but the point in [00:33:00] it was that you don't go out and create another me too company.
Right. You don't go out and create something that's already out there because building a better mouse trap is like, not. Not the way to creating something lasting, because if you've got a me too product, then sooner or later, you'll either be out of business bought, acquired, or just give up, right. By the way it was from zero to one.
The thing here, the thing here though, is. This is what first principles can help you do. And this is what the example that he is giving as those starting points is what's a secret that you know, that nobody else knows, or what's a company that should exist that doesn't, and that's really interesting framing because he's pushing towards uniqueness.
And that's the characteristic of Einstein's thinking it's Charlie, monger's thinking of Elon. Musk's thinking all of them are bringing something [00:34:00] radically new. Then there are no me too products in the portfolio of Elon Musk. And I think the difference that you're describing is the science approach.
Isn't it? Because it's born out of a physicist's mind, philosophers mind that helps people like enseno people like Elon Musk really think about a problem from a practical aspect perspective and consider brand new ways of solving or creating. The solution that you can't afford in physics, let's say to just rinse and repeat and pull out the same law, you know, imagine Einstein was famous for just doing the same work as everybody else.
He wouldn't be known that much. Likewise. If he just was famous for creating the carbon copy copies of other businesses. Yeah. He might still be known if it was successful, but not to the extent that he is [00:35:00] right now. And I think that's exactly like you've just said, because he's doing it something totally different than the others.
And he's thinking from a brand new perspective, and that really comes from breaking it down into that first principle thinking really getting down into the heart of that, and then being able to distinguish what's unique in the space. Yeah, definitely. So now, as we're in this second part, what we're going to do is actually hear from Ilan, actually breaking down the application of first principles.
This is so we can really get the binary, foundational level understanding of what it is. And we're going to hear the man himself, Mr. Musk, talking about how he thought differently about battery packs. I think it's also important to reason from post principles rather than by analogy. So the normal way that we conduct our lives is we, we, we, we reason by analogy [00:36:00] it's, we're doing this because it's like something else that was done or it's like what other people are doing me too type ideas.
Yeah. Slight iterations on a theme. And, and and. Cause it's, it's, it's kinda mentally easier to reason by analogy rather than from first principles. But by first principles is kind of a physics way of looking at the world. And what that really means is you kind of boil things down to the most fundamental truths and say, okay, what are we sure is true or, or assure as possible as true.
And then reason up from there that takes a lot more mental energy. Do you have an example of that? Like, what's one thing that you've done that on, that you feel has worked for you? Yeah, sure. So somebody could say and in fact people do that battery packs are really expensive and that's just the way they will always be.
Cause that's the way they've been in the past. And like, [00:37:00] well, no, that's, that's pretty dumb, you know, because if, if if you apply that reasoning to anything new that then you wouldn't be able to, to ever get to that new thing. Right. So You know, it's like, you can't say, oh, you know, horses, well, nobody wants a car because horses are great and we're used to them and they can eat grass.
There's lots of grass all over the place. And you know, there's not like a, there's no gasoline that people can buy. So if you want to begin with never get never going to get cars. Right. That people did say that, you know and, and for batteries, they would say, oh, it's gonna cost, you know, historically it's cost $6,600 for $600 per kilowatt hour.
And so it's not going to be much better than that in the future. And you say no. Okay. W what what are the batches made of? So, so first principles would be, we say, [00:38:00] okay, what are the material constituents of the batteries? What is the spot market value of the material constituents? So you can say, okay, it's got cobalt, nickel, aluminum, carbon and some Paulina's for separation and a seal can, so break that down in our, on a material basis and say, If we bought that in London metal exchange, what would each of those things cost like?
Oh, geez. It's like $80 per kilowatt hour. So clearly you just need to think of clever ways to take those materials and combine them into the shape of a battery cell. And you can have batteries that are much, much cheaper than anyone realizes. Oh, Mike. I mean, if we could really get a clip that puts it into almost a case study, to help me understand the value of first principle thinking.
And in fact to go one level deeper than that actually hear from somebody who's used it physically to create a new product. I'm not sure whether we could have found a [00:39:00] clip from somebody like Elon Musk, really breaking it down as well as that. I mean, this was perhaps one of the most important clips of this show, because what we saw him do is actually tear down batteries using first principle thinking.
And there is this sort of, this pattern of getting to fundamentals there, which we're going to in the next part of the show, we're going to show you how to do this time after time. But I actually want to just kind of pivot and show you how he's thinking has played out in real life. So batteries are in their cars.
Well, let's have a look at the EPA range ratings across cars that are electric vehicles when they're using both cities and highways. Okay. So this is the, I think the most recent data we could find, and they took the, you know, the top five cars in the U [00:40:00] S number one, Tesla model S 370 miles. Number two, Tesla model three, three hundred and twenty five miles.
Okay. So then we have their first competitor coming in. The Chevrolet bolt Evy comes in at 259 miles. Now that's more than a hundred mile difference. And here's the interesting thing. How long has Chevrolet been in business? A lot longer than Tesla, right? Yeah. They were just doing the same old thinking and they were like, oh, we better get into batteries, but they just can't do it as well as Tesla.
Why? Because Tesla and Elon apply first principles thinking, this is, you see, what's starting to happen. Now when you have this original vein of thinking, [00:41:00] when you really break down. The component parts and then build up with friends, new thinking, not constraints by traditional paradigm or analogy, but look at new creative ways to build upon those truth.
This is the result you get. And mark, this is like not only, not only the system they're having in terms of the performance of their batteries in the cars. I mean their business is doing pretty good. Is it again, the most recent data we could find that breaks down, Mike, the best selling electric cars in each one of 2020, the first six months of 2020.
I mean, when I look at the table, Tesla is dominating for electric vehicles. Out of the top eight that are being sold, including positions, number one, two, and three, all Tesla vehicles. But the crazy thing, Mike is the estimated sale of the Tesla model three at [00:42:00] 38,000 in January to June, 2020. If I break that down again against that Chevy bolt that you referenced, it's about 300% higher for more and more sales, it's more, it's more than 300% more than the Chevy.
And of course there's all culminates in a stock price that is like more than double that of either GM or Ford. This is the living case study of first principles thinking what a privilege we have marked to be able to actually study this right now, to learn right now on how this reconsidering of the battery has led to this huge, gigantic impact.
And it was done using first principles. But we have not finished here. Have we in using case studies to really explore the science or as Ilan would say the physics of first principles, this next clip we've got from the realized, man is again, taking us into a physics and science space. In fact, [00:43:00] Mike, you and I were getting into the space shuttle and launching out of the atmosphere.
This next case study that we're going to hear about is about space X and how to outsmart that status quo. Why is it the mosque can have success in several different fields whilst the average person can't seem to figure out one, it boils down to his ability to think from first principles. The most noteworthy example is his approach to space X in 2010 NASA officials under the Obama administration predicted that you would take 12 years and cost $26 billion to send men back into space.
Recently Ilan and his team, a space X were able to send two astronauts into space with two months and have the rocket returned to earth reuse. This was done in six years, half the time predicted by the experts and at a cost of only 1 billion. Looking at the problem [00:44:00] from first principles was what allowed the innovative measures to happen with Elan style space X.
He knows that the price for space travel was heavily inflated. Most of the costs were distributed between the middleman and expensive space ship parts. When Elan broke each component into fundamental parts, he saw that the cost of the raw materials was far from exorbitant and by sourcing the requirement tours himself, he could cut the costs dramatically space X has been successful because it did not continue the string of thinking done by others before.
They did not reason from analogy and chose to apply more energy into uncovering the first principles of space. Do you know, it's just crazy to see that what Ilan did with Tesla using first principles. He did it again at space X and it's happening at this very moment. Isn't it. I just, [00:45:00] again, boggles my mind when I'm watching those videos.
Mike has, I'm sure you do as well of the rockets landing on the, on the, on the pads in the ocean that I don't want to sound like a fan boy, but just for a second, I get, there's a part of me that gets pretty excited. You know, it's kind of goosebumps territory when you can see them landing or for reuse, and that would never have been possible, or maybe not even considered in the old way of thinking.
As we've we've heard elsewhere, it was actually considered cheaper to actually not bother doing reusable rockets because at the time it was just much easier. Right. We'll send it up, we'll build another, nobody had considered going down this first principle way of thinking to source their own raw materials to make it so much cheaper.
And in fact, they just defaulted into that traditional way of thinking and just, let's just build another one. Let's just build another one. And [00:46:00] that's why it was so exorbitant the crazy thing. And is that the first principles thinking re-imagined shook up an industry, like space travel, right? Just like he did in automotive and battery business, but.
Financial impact the measurable impact of this first principles thinking is also tremendous. Isn't it? It's absolutely huge. Again, similar to some data that we found, like, I just want to break this down for you a little bit when you if you think about inflation historical references for the U S dollar and so on, we can make the following connection, the Apollo spacecraft operating.
Remember this was actually quite quite a reusable type element, the space shuttle between the sixties and early seventies. It would cost. Per seat for an astronauts [00:47:00] 390 million us dollars. Yeah. And just to qualify, that's the Apollo, that's not the spacial space. Shuttle was also very expensive. It was about 170 million.
We're talking about the Apollo series, you know, your classic Tom Hanks, going to the show, but, but just get those numbers per astronauts to send them up 390 million for the classic Apollo series, and then have more recent times space shuttle. They trimmed it down a bit. They got it to one 70 days. They got into one 70 between the eighties and nineties and early 2000.
But Mike, let's go back into the space X room and look at the dragon too, which is a cost per astronauts of $55 million from 390 million, the Apollo all the way down to 55 million. That's such a huge. So again, we're seeing there's a remarkable [00:48:00] impact, remarkable results, measurable results from this thinking.
And you have to be remarkable in your thinking. You have to a break things down to their fundamental component parts and to what is happening in both space X and Tesla is we are seeing this thinking of asking these big questions, not rooted in analogy to what is happening now, but new thinking, unconstrained thinking, thinking about possibilities, asking big questions, having a big appetite for creating brand new things.
And it all starts with this elementary physics, like thinking to get the facts to get the data. It just strikes me, Mike. The, the examples we've just heard from Tesla, with the batteries and SpaceX with reasonable elements and rural materials and sourcing them from other places. Again, it almost seems [00:49:00] so sensible, but I think that analogy thinking, as you just said, again, grounds us in a traditional method of approaching problems.
And I wondered Mike, is there, how can we consider the different frameworks on how we think, how can we consider, you know, a traditional element where we might be informed by our classroom and actually transfer ourselves into this element of first principles thinking? Yeah. So my go-to playbook recommendation here would always, when we think about mental models, Is to first ask yourself, what, what are you trying to achieve with your thinking?
Are you trying to solve a problem, make a decision or differently kind of design a system of some sort, because the model that you apply. [00:50:00] Changes based on those questions that I just rose. So problem solving like we've heard is obviously go to his first principles, but there's also inversion. There's also doing all sorts of problems to get to the root cause a five.
Why? And we'll talk about those. Here's the thing, problem solving is all about going to the root. It's all about there's a very black and white thinking of the source of the problem decision-making is a bit different because decision-making, is it tends to have more of dimensionalizing the problem and the solution and in particular, coming at things with different perspectives or putting to Two vectors together, for example, the Eisenhower matrix, which is great for decision-making and how you prioritize your time.
You're, you're asking yourself what's urgent and important. You know, the DeBono [00:51:00] thinking called six hats is about adopting six very distinct ways to look at a problem that are very kind of different. Almost like personalities, if you will. Or second order thinking is like, okay, if I did do that solution, what would be the consequence?
These are all ways of making better decisions. Now, when we go to systems thinking there's all sorts of loops and models and circle systems that you can do to understand things like the relationship between things or the forces between things so that you can create better systems. So for example, a great idea of systems thinking is, you know, cryptocurrency or blockchain, that's an amazing kind of set of systems that you would create using systems thinking.
So these are all different options where squarely over in the problem solving mode, and that kind of feels right. It doesn't matter because if you look at what Elon did is he solved the [00:52:00] problem of batteries being inefficient. He solved the problem of sending astronauts into space, being too expensive.
Didn't it that's fundamentally what he went out to solve. You know, you can't create a new. Element a new thing with that same old thinking. And you know, if a problem is right, how am I going to make an electric car run further than other electric cars? Or how am I going to be able to get into space on an affordable or more affordable budget?
That's a real problem to try and go and solve. And if first principles helps Elon Musk solve those types of big old challenges, then I think it can help me solve some of their challenges that maybe I've got day-to-day as well. Mike, totally. So let's let's kind of mark this really important moment.
Now, Mike, we're going to ask ourselves, how do I do this every single day? How do I build a habit and a routine of thinking better and [00:53:00] using first principles? Yeah, this is going to be similar to how we had an, our first show Mike at where I could learn about applying motivation into my day to day. This is our chance to really learn from first principles and really practice it day to day.
And this next clip, Mike, I thought would get us into the right level of thinking. And there's a great clip from Dreamlands on how to apply first principles today and how Elon Musk questions. Step one, identify your vision or goal. You need to make sure that this is a specific and clear as possible.
Otherwise, it's going to be difficult to do the following steps. Elan's ultimate vision for space X is to colonize Mars on the space X website. The mission statement is to revolutionize space technology, ultimate goal of enabling people to live on other planets. This is a very clear mission that is easy to visualize and understand.
Step two, with the goal comes [00:54:00] different types of obstacles, list out all the time, obstacles and actions you think you need to do to get better. Pass them, perform steps three and four for each of them. Most people stop at steps two, and then immediately take actions on the assumptions. Step three is where you really apply for printer.
Elan's primary obstacle in the beginning was that he needed to advance rocket technology to be able to reach Mars at a reasonable price. So here's a short version of the story. In 2001, a 30 year old Ilan takes a huge interest in space and getting to Mars. He found out that NASA had no plans to do this.
So he set out on a mission to do himself to get past the first obstacle Elan met with experts and educated himself with books as an action step for his primary obstacle, Elan believed that he needed to go to Russia to find an ICBM to use as launch vehicle. And this is why he actually. But he wasn't taken seriously.
This is where step three comes in. Identify current assumptions about the obstacles and actions needed to get closer to your goal. Break it down into first principles by asking [00:55:00] powerful questions. And this is exactly what Elon did. Instead of relying on the Russians. He took a first principles approach.
Some of the questions he asked were, what are the physics of it? How much time will it take? How much will it cost? How much cheaper can I make it after asking these questions and doing some research Ilan found out that he can make a rocket for much cheaper than anybody could imagine on the flight. Back from Russia, he showed his two friends.
This spreadsheet that he created using the knowledge he gained from studying. And found that it was possible for them to create it themselves. This brings us to step four. Once the first principles are discovered using them to reason up and build a new creative solution for the obstacle Ilan set out to make this dream happen.
So he gathered a team refine the plans based off the first principles, giving birth to space X on June, 2002. Rocket technology had been pretty much stagnated for decades, but Elan used first principles thinking to effectively reignite the dream for space. Remember that first principles is a way of [00:56:00] thinking to apply it in all actions.
You just need to have one goal in mind to know the truth, the opposite, the goals are lies and assumptions. Your third step is to continuously ask questions in doubt, until you get down to the first principles. And finally, from there use what you've found to reason up to the truth. In that sense, you will always be applying first principles thinking and everything you do.
In everything you do apply first principles, thinking, ask these questions to get to the truth of the matter and ma we've got some great tips, suggestions, and practices that you can do to think like a yawn to really question things. So let me, let me hit you with like a famous, famous model that can be used as part of first principles thinking or just on its own.
And that's called the five why's it's been made popular by Toyota. And mark, I think we've mentioned this a couple of [00:57:00] times now. Yeah. On the, on the moonshot show, we've definitely run into the five wides because of its reference to Toyota and how they would dig deep, deep, deep into the root cause of a problem.
So, Hey Mike, how do we, how can I maybe do that in my day to day? What's the benefit. Well, so you, you would usually start with, you know, an outcome, right? Let's say you could be very positive. Hey let's say you're a football team. Hey, we won the match today. Why? Well, we scored more goals than them. Why? Well, we had more possession of the game.
Why? Because in training we focused on retaining the ball. Oh, why? Because we've studied over the last 10 games. When we have over 60% of the possession, we always win. Boom, boom. That was a great, great demonstration. It's very, very practical [00:58:00] actually. Isn't it? It is because it gets you into this idea of working.
It's sort of reverse engineering of verbiage. You start with like, Why did that happen? And then you can get to the root cause. And once you get to the root cause of something, you can then do this thing called Socratic questioning where, and I always just, you've heard me talk about this a lot. Not be like Sherlock Holmes.
Like you're like not accepting anything at face value. Right? You want to question the living hell out of everything to make sure you do have that fundamental truth. So we've got a list here, mark. I'll hit you with the first one, the clarification. So let's say you're at the root of something and you're like, don't just say, oh, okay.
You can say, well, hang on. What do you mean by X, Y and Zed? Like, just to make sure that you really clarify what we're talking about. You know, it can be simple things like, is that number in euros or [00:59:00] dollars, right? Is that, is that number for 2020 or 2021? Does this take into consideration inflation or currency rates or depreciation?
Like, just clarify what they mean when people just give you a number, but you're good or bad. Just like, well, hang on. What do you actually mean there? That's a good one, right? Yeah. What have you? That makes sense. That makes sense. So understand where you are from the beginning. I think building on that, the second Socratic question would be probing assumptions.
So for example, would that number you've just referenced maybe I assume it's you. Okay. But the truth is for what could I assume instead, maybe it is us dollars. And then even further, if someone said, well, why is the number like that? And they say, oh, because of this, you could also say, Hmm, could we assume it might also be just something that challenge the perceptions of the other parts as well?
Yes. Yeah. But, but what you do is if, and you need a lot of trust in the conversation because it's not a [01:00:00] judgment, but just like, well, maybe we could think, you know, could we, could we adopt a different assumption right now, another way of doing this is when you really get into this is building off what I said earlier.
It's it's really probing people. Why do you think this is true? Right. So you're not just doing why you're going. Why do you think this is true? Why do you think this is the fact? And you can hear the reasoning in someone's mind, right? It's very good. You hear them thinking out loud together helps you get aligned matter.
I think that once you've understood the context of what that individual, your, your partner or whoever has brought that reason to the table, it's also to understand what as the next question would be the implications and consequences of that piece of context or because of that. Decision-making. So what effect would that a piece of context or idea really have.
Yeah, totally [01:01:00] agree. And then you can also, you can also go like, okay, we've been looking at this from the point of view as tech guys let's look at it as battery guys or automotive guys. Or let's, we've been looking at it from a very defensive point of view, what would be an offensive point of view?
Right? So you can take different points of view. This is something we've spoken about in the show as well, deliberately taking the other side of the argument to see if your argument is actually good enough. Yeah. Quite like that almost devil's advocate. And with that same concept of playing and questioning that different viewpoint, you could in fact question, the original question itself might, can you, and what was the, what was the point of that question?
Why are we here? What are we trying to achieve? That's a really nice way. I think of. I think the key word is, is discipline. Actually, isn't it, rather than accenting, the fundamental fact that somebody has given you, instead of being able to [01:02:00] practice five ways and soccer biotic questioning, you can challenge your own assumptions and the way that you interpret that truth.
Well, that element, I think it is the deliberate open, constructive conversation and challenge to how we are thinking. And it's quite interesting as we're talking about this, as we explain how we do it, I think it also requires objectivity, not judging others for being left right up or down, but just accepting points of view.
And you know, something that we've really discovered is that the great thinkers of the world actually love discovering an imperfection in their thing. Great thinkers in the world. See the process of making their idea less wrong over time. And what I mean by that is wishful thinkers. Love [01:03:00] to think. Yep.
I've got it. They've rushed to action. They've jumped to conclusions and the great thinkers are so deliberate and they're so eager to understand, well, how can I make this thinking better? Where are the weaknesses in this? And that's why it's interesting to, you know, play that devil's advocate on your own idea to make it strong and robust, like, well seasoned.
It's like, it's like the seasons pre-training before the season kickoff, you want to get in a few good games. You want to hit the gym. You want to be ready to go, don't you, you don't want to just walk out for the first game go, well, I thought we'd play like this. And everyone's like, how do you play? Like, I don't know the whistles about let's go, you know?
Exactly. And I think when you. But when you listen to these clips that we've had today, a few with, with Elan mask, the one thing that strikes me as he knows the game, you know, he, he is able to think in this type of approach towards automotive and even space travel [01:04:00] because he's taken the time to learn from others and then questioning everything and, and ultimately getting really curious in order to go out and break down a potential challenge.
Or now what you can see is a fundamental question of first principles is why. And we've got Gary tan again, Gary's brought so much value in this first principles. That's awesome. He's actually going to get us right into this practice. And remember, this is something you can do every day. You can build a habit of this every time, you know, you've got a problem to solve.
You can dig into Toyota's five whys. Asking questions and digging further to understand how those systems work. One of the key ways to do this is actually the five whys analysis. It's something that the Toyota production system came up with years ago in Japan. Here's one of my favorite examples from a blog post by Eric Reese, the creator of the lean startup.
So imagine your website's [01:05:00] down first. Why, why was the website down while the CPU utilization on our front end servers went to a hundred percent. Second. Why? Why did the CPU usage spike? Well, some code contained an infinite loop. Third. Why? Well, why did that code get written? A programmer made a mistake.
Why did that mistake get checked in? He didn't write a unit test for the feature. Well, why didn't he write a unit test? He's a new employee and he wasn't properly trained to do test driven development. So if you ask why it will allow you to fully explore why something works. Eric says because the most common problems keep recurring your prevention efforts are automatically focused on the 20% of your product that needs the most help.
That's also the same 20% that causes you to waste the most time. So five Y is actually pays for itself awfully fast, and it makes life noticeably better almost right away. The five whys is [01:06:00] why the toilet, the production system made Toyota. So successful today. We think Japanese cars are incredibly reliable, but they had to come up with a process to get.
And curiosity is a key part of understanding why things are and then how to fix it. And that's gotta be the DNA. If we were to boil down Mike, the first principles of Elon Musk himself, I think that curiosity and that desire to question the production line is, is what sets him aside from others that he's got not only this way of thinking this way of capturing problems and thinking about them in different ways, but he's just got this natural curiosity.
And I think that's something that if, if I'm to reflect on how to. Think about problems differently today. And I'm to think about how I can go out and create new products, new experiences, or services with our customers, or [01:07:00] with one another. It feels as though having that kind of energy dynamic desire to be curious about the space enables me to not then default into the analogy thinking, because if I'm, if I'm going to default and I'm not really curious, that's where I'm going to immediately go to.
Yes. Yes. So that's, that's also, as we've got into this today, that's why I've been so keen to almost call out the bad behavior of rushing to conclusion, wishful thinking or this analogy thinking. Rinse and repeat doing what everybody else is doing. Like if you're doing this, doing it the same way, why would you expect a different result?
Right. So that's the power of first principles. That's the power of pushing off against those bad habits. And I think that the [01:08:00] the other thing in making this a habit is, is giving yourself some time to actually ask why isn't it? I mean, how do we make more time for this mark? Like what could you do in your work to ask them why more?
I think that's really the crux of the challenge here, isn't it? Because, yes, it's great to be able to ask why, but I've got to be disciplined enough to actually do it because my default again will be, oh, well, there's an emergency on the table. There's a fire that started I'd better respond straight away.
I will take the fact that somebody else has given me as truth rather than applying the five ways or the sock periodic questioning. And I think Mike, it's actually a behavior or attending that we have discussed a couple of times before on the moonshot show. And in fact, I think it might even have turned up in episode one on motivation and then.
The secret of time-blocking and just forcing yourself to not be [01:09:00] distracted by emails or notifications or lots of zoom calls. And instead, just enabling yourself to sit down and say, right, I've got an hour or two hours, or even half an hour to really consider what somebody has given me as a recommendation or a problem that I've received that I need to figure out sitting down by carving out some time and really thinking about the problem much like do, and actually trying to get to the root cause perhaps through the five why's or perhaps through the soccer sciatic questioning and just playing it out.
In my own mind, I would only be able to do if I gave myself and afforded myself enough time to do it. And I think that's where time-blocking and keeping it sacred would be really. Totally it's it's allocated time. So, you know, whenever you see a big decision and I would stop by writing it [01:10:00] down and then secondly, allocating time in your calendar, just to ask why to study the question.
Yeah. I like the writing it down as well, because much like we talked about, in fact Mike and our recent mental model series on the moonshot show by writing something down, maybe it's a note that you've heard on a telephone call, or maybe it's an email you've received and you're writing a document or response, and we've discussed writing one pages or tables of contents in the past.
I think by writing it down like you would, when you're journaling, you're able to compartmentalize it in your, in your mind. And not only are you enabling yourself to reflect upon it in the here and now as you write it down. But if you have the time to actually step away from it, your brain does the like like a coffee machine, it percolates and it starts thinking over.
Okay, well, I wrote down [01:11:00] the fact that he needed a response by Friday, you know, the deadlines next Monday, he needs a response on Friday. Okay. Only by having a moment to reflect. Well, I think, well, why is it Monday? Why is that his deadline? Because I know he doesn't have the meeting for two weeks. Is it a, is it a false deadline?
Is there more time? I wonder what's causing that immediacy of response and only by, instead of launching in and providing that answer or that response straight away, affording yourself a moment to almost reflect on it after you've written down, I think is is a great way of creating some thinking space.
Would you agree? Yeah, I think so. I think it's all about not only learning how to do this, it's learning how to make a part of your day. And I would say when big decisions, particularly big problems are coming your way, what do we do next year with the company? Do we create a [01:12:00] new product? Do we create a new team?
Okay. Okay. Why, why like flash, flash flash, if there's a problem to be solved or a decision, we may make time for it. And in the case of first principles, if you're really trying to solve a problem, know that your temptation will be to right to judgment or to just solve the same thing the same way as everybody else and not get the remarkable.
Result. What do you think? Yeah, I definitely agree. We definitely got this. They're both, again, products of the analogy thinking I think rushing to a decision is what you're kind of trained to do. I think maybe it's more of a career behavior than a school one, but that immediacy is a default behavior that I've certainly got.
And I'm certainly working on as we, as we break down, you know, motivation first principles, as I am trying to consider how I respond [01:13:00] to challenges in my own day, staying motivated or really drilling down into the facts. That's going to be something that I'm going to have to challenge myself by staying disciplined again, taking we've talked about it before taking ownership over the fact that I am allowed to question.
That situation, perhaps. And it's funny how, it's funny, how discipline is so important for things like motivation and thinking. Yeah, it is. It always comes into some of the topics that we discuss, actually the discipline of staying on track or the discipline to actually carve out enough time in your own day to think about problems, you know, that requires discipline, doesn't it?
Yeah. And I think that there's this deliberateness that sometimes in the busy-ness of the day, we lose a lot of our intention and deliberateness. We're just like running [01:14:00] from call to call, meeting, to meeting document to document and. It's it's like, if this is first principles and motivation are essential to being the best version of yourself, it's like having these constant reminders, making it a lifestyle, right.
As James clear, the author of atomic habits said, it's gotta be a lifestyle. You can't just opt in and out just when you're like, it's gotta be there. It's gotta be a living and breathing in the way you work. It really, really does. In fact, it's almost as important are these mental models and these ways of, of thinking about problem solving challenges systems, it's got to be as big a part as meetings.
It's gotta be as big a part. There's the tools that we use, like emails or slack. I think it's gotta be in your repertoire of how you respond to things in that working day. And actually, again, as we found out in that the [01:15:00] most and the mental model, Without having that armory you're falling into the same bad habits as you've referenced on today's master series, Mike, where we're kind of following a bit of a bad habit.
If you don't utilize something like first principles to really drill into the core of a problem. Yeah, absolutely. And the good thing is to bring it all home for us today, we have who is new to us. We have not done a moonshots podcast on him yet, but I think once you've listened to this, you'll understand why we will be doing one on him in short order.
So let's bring it all home for first principles thinking and learn how we can think like a rocket scientist. So knowledge is really useful. Of course, knowing what other people have done knowing what's worked for other people than what hasn't worked is really useful. And you can't completely shut out knowledge.[01:16:00]
And so the trick with using first principles becomes, how do you not, how do you use knowledge to inform what you're doing as opposed to constrain it? So, one example I give and think like a rocket scientist is reusability of rockets. So for decades, rockets that carried their payload into orbit, couldn't be reused.
They would plunge back into the ocean or burn up in the atmosphere, requiring a new rocket to be, to be rebuilt again. Now imagine doing the same thing for. Commercial flights, right? Like you fly. I live in Portland, Oregon, you fly from Portland to Los Angeles, the plane the passengers D plane, and then someone steps up to the plane.
And just, that's basically what we did for rockets for decades. Now, NASA space shuttle was partially reusable. So some components of it could be refurbished and reuse, but it was really expensive because the space shuttle was a really complicated [01:17:00] machine. And so refurbishing and reusing the space shuttle actually costs more than building an entire shuttle.
Gotcha. So if you look at that and if, you know, if you're say entering aerospace and thinking about building your own rockets, and you look at that and you know, that reusability didn't work for NASA. Well, that knowledge can be used to constrain, right? You can say, well, it didn't work for NASA, so it's not gonna work for me.
So I'm not even going to bother trying to create reusable rockets, but if you're using knowledge to inform the approach becomes slightly different. So you don't ignore what NASA has done, but you look and say, okay, so reusability didn't work for NASA space shuttle, but why didn't it work? In other words, what was the underlying cost for this?
It's not that all reusability is as unworkable it's that the particular reusability that NASA was using with respect to the space [01:18:00] shuttle, which was a really complicated machine that didn't work. But if you have a less complicated rocket then reusability might be an option. So the trick again is to, to take what, you know, And use it to inform what you do next, but not to constrain it.
And that line between informing and constraining, it can be really hard. The draw, there we go. Mike, it's all coming into clarity in my vision, the concept of first principles we've learned from case studies and now hearing from us on viral, this knowledge to inform your decision-making it, it's a great reminder that yes, you can look at you know, the failures of others in order to, to learn.
As long as you question, maybe what happened, you can actually find out a truth or an element in there that is really, really valuable to remember and [01:19:00] learn. Yeah. Yeah, yeah. And he really talked about, you know, go back, get the facts, but don't let those become constraints go and imagine the unimaginable solve the unsolvable by, by thinking differently and putting on that different lens.
So it's like, you got to go be Sherlock Holmes, get all the facts, really questioned them and then put those in a different lens, a different order. It was like, I see it's like Lego blocks. You take them all apart. Find the component pieces, but reassemble in a different way. Yeah, you got it. Exactly. It's like the Lego.
So again, break it down into these little pieces. I think brought it home for us quite well. There, he, you know, he's, he's referenced this, this concept of, of NASA versus Ilan again for us. And I think it just helps me Mike understand how I can try and put first principles into practice today. Just that again, that kind of cure us through that willingness to learn and notice and, and try to.[01:20:00]
Determine how I can, I can apply it is, is fascinating to me. It is, it is. It's a really exciting, I mean, that, and that's actually the whole thing about first principles is it's all about possibilities. As I said, solving the unsolvable, imagining the unimaginable, because you get your strip things right back, and then you just imagine on top take a different lens.
I mean, that is a great way to think about your daily ritual, get the facts and then put it on a different lens and see what could be, I mean, that's as good and exciting as creating a company that takes me to space. I'd say that's my own version. Well done. Well done. So for you, mark, you know, w let's let's see, which what's really stood out for you.
We've done, you know, we've set the scene with the inspiration. We've heard from some pretty amazing people from Aristotle to mosque. We've done these case [01:21:00] studies of, you know, Tesla, SpaceX, Peter, Teal's thinking of doing one thing better than anyone else. And then we brought it home with some of these questions of why these three steps of thinking like a rocket scientist, putting in that different lens of all of those things.
What really stood out to you as the kind of most important thing for you to go work off so much? I think it's just the practical acknowledgment, as well as the discipline to not fall into the classic response that something is too hard. So the clip that we heard with Ilan breaking down the batteries, I think for me a big penny drop moment because it's something that the industry professionals, probably a lot of his peers were [01:22:00] turning around and saying, you know, it's too expensive to bother with kilowatt hours trying to bring it down from $600.
Let's let's no bother him, but his discipline to, to really focus on the challenge and try and break it down and understand, well, why not just source it from other places or in fact, so-so myself remove the middleman cost. I can bring it down to, I can't remember the exact number, but it was substantially more than 600 in the end.
It was, it, it seems so sensible, but, but so difficult or. So hard to, to acknowledge, I think because you're so used to following a pretty familiar pattern. So for me, my big takeout for first principles is not only having the vision to drill down at question Y all the way down to that DNA, but actually have the discipline to want to do it in the first place.
Yeah. Yeah. Yeah. It's funny. Isn't it? Because you, you you've, you've really got [01:23:00] three parts to the challenge. One is to make first principles and important practice to, to understand how it really works. Like the content of it, like we saw in those case studies and then three, you've got to make the time.
Right. You got gotta make the time. And it is. And Ilan and readily admits it's kind of easier to either jump to a conclusion. We'll be lazy in to solve something the same way everyone else is doing. But I thought, I thought it was really interesting that each of those three steps present their own challenge.
Yeah. And that is the really difficult thing. So if you are going to try and make it a daily habit and be disciplined with practicing at each day, you've got to make that time. You've got to be curious. You've got to desire to go out and solve that problem because yeah, you're right. It is [01:24:00] sometimes a bit easier to follow the status quo.
And as we heard today, you're not going to go out and create something brand new and exciting by following old house. Totally, totally. Well, Marco, once again, we come to the end of a show where I want to thank you for our second master series on food. Principals and thank you to you. All of our listeners, the moon shows that people who want to learn out loud as a means to being the best version of yourself.
And today it was about thinking better. It was about problem solving and making better decisions. It was about first principles and boy, it really started with challenging, challenging our preconceived notions. And we have did everyone from Aristotle to Elon Musk users principles, and that the essence of it it's boiling things down to their [01:25:00] fundamental truth.
And how exciting was it that we got to learn from case studies from some of the best living entrepreneurs, Peter teal and Elon Musk. We learned I'm paid to do one thing better than anyone else from Ilan. When he thinks Tesla, he's saying reconsider down to the physics and chemistry level, the battery pack.
And if you do that, great things will happen. If you outsmart the status quo like they did in space X, great things will happen. You will build things that matter and have an impact that lasts. So that brings us to our last point, which is how do we make this part of our day? We question everything and we use that most powerful question of why all of the time, if you do all of these things, you will truly, as Ozan Varroa says, be able to think like a rocket scientist.
It is right before you here. And today you can be the best version of yourself with first principles. All right. That's it. From the moonshots [01:26:00] podcast master series, that's a wrap.