Elon Musk is perhaps one of the most amazing entrepreneurs out there in the world. He is the CEO of Tesla Motors and SpaceX, chairman of SolarCity, and co-chairman of OpenAI. He has a vision to change the world and humanity and uses first principle thinking. This is what has guided him throughout his entrepreneurial ventures.

First Principle

The first principle is the most basic truth that cannot be deduced any other way. You look at a problem and break that into small fundamental truths, which are the first principles, and then work your way up. Through this way of thinking, one can explore from new perspectives, leading to innovation. In simpler terms, first principle thinking means coming up with the simplest and most direct solution. According to Musk, the first principle is about looking things through the lens of physics. Breaking things into the most basic truths and working your way up may require more energy.

The First Principle Used by Elon Musk

By using the first principle, Elon Musk has been able to achieve amazing results like cheap battery packs and cheap rockets. According to him, people should use the first principle rather than an analogy to reason. When we use analogies, we confine ourselves within the already known things, which limits innovation. On the other hand, the first principle thinking does not limit us when it comes to innovation. Elon Musk himself explained the power of the first principle with the example of a battery pack. A battery cost about $600 per kilowatt hour, which will not get lower in the future. If we approach this through the first principle, we would first think about the things that make up a battery pack and how much value each of these things have. Then we would get these things separately and figure out the way of using them to create a battery pack. This would be much cheaper than the battery packs on the markets. The same thinking was used in the case of rockets produced by SpaceX which cost 2% less than other rockets made in the market. If you want to make a rocket, there are some necessary things you need. Thus, by looking at the price for these individual components and working with the first principle, you can reduce the cost by using the same principle in the case of battery packs. Identify the elements necessary, get them separately from the market, and find out the way to make your own components. Now you have rockets that are cheaper than the market. It is true that reasoning through the first principle is a great way of thinking, especially when you are trying to come up with something new. It is true that you may run into more questions, but this would lead you to unique and great innovations. Nevertheless, it is a great way to see the world differently. This thinking can yield good results as this can be seen in the case of Elon Musk.