Zero Based Principles — rational vc

How To Think Beyond First Principles

Iman Olya

23rd June 2021

Part 1: Deep Breaths Through Smoke

Part 2: First

Part 3: Zero

Part 4: 0 + 1 = ∞

Part 5: Smoke Your Own Pipe

Part 1: Deep Breaths Through Smoke

Europe was on the precipice. The largest war of modern times was raging on and nowhere was this felt more than in the heart of Germany. Blockades were causing major food shortages, trench warfare of the Winter of 1914 had led to mass deaths on the frontline. Morale was depleted on both sides. A collective belief of impending doom was on every European’s mind.

In Berlin, a young physicist sits disheveled, struggling with a more existential issue. He’s stressed. Not least with what the newspapers say, but with letters from his separated wife in Zurich, ordering him to see his kids and support them financially. After all, he’s promised her the winnings from a Nobel prize he’s yet to win. His boss, one of the greatest chemists of all time, seems to relish the war, building chemical weapons and deploying them enthusiastically on the front line. This young physicist is disgusted. He’s also under pressure from his peers. A genius German mathematician is hot on his heels, ready to prove a theorem that this young physicist cannot crack.

But stress does not impede his focus. He agrees to a series of lectures across four weeks in November 1915 to prove to the world his new theory. Problem is, he’s nowhere near the actual answer. Nothing like a bit of pressure - a deadline - to add that fire under your bum.

In every lecture he would get up on the podium, correct where he went wrong the week before and continue with his new findings. He did not care about public failure. He was building in public before it was cool.

See this young physicist was sure of his idea. He just couldn’t make the calculus work. His competitor was widely regarded as the greatest mathematician of his time. And he was so impressed with this young physicist’s idea, he wanted to beat him to cracking the math. The prize? Basically becoming the next Isaac Newton. So, no small feat.

Somehow, in some miraculous way, the young physicist finishes the theorem in time. But he needs to prove it. He tests it on a two hundred year-old anomaly: Newton’s failed attempt to explain the orbit of Mercury. The output of his calculations mirror exactly what astronomers have observed: Mercury’s orbit around the Sun deviates slightly each time it circumvents.

His heart is racing, he struggles to breathe. He walks over to his armchair, falls back, quickly crushes tobacco into his pipe, lights it and takes the joyous first puff. Ironically, it is with smoke that he can finally take a deep breath. He has solved it; one of the most important scientific discoveries of all time. Against all the odds too, with his baby momma on his back, a murderous boss and a genius contemporary. This young physicist can finally breathe.

On the 25th of November 1915, Albert Einstein laid out his General Theory of Relativity at his climactic fourth lecture at the Prussian Academy of Sciences in Berlin.

This period would come to be seen as one of the most important and intense periods in scientific history. Not just because it was a race to the finish. Not just because the world was seemingly ending around him. But because this young physicist had set in motion a general theory that would challenge the very structure of our physical nature for decades to come.

This memo is not actually about Einstein though. It is about something he possessed. An ability to think, not from first-principles, but from zero.

Part 2: First

In Silicon Valley there is an obsession with first-principles thinking. I’m obsessed with it too, for good reason. It is the fastest way to make accurate decisions without having all the data. It is a logical way to approach problems. But logic means the first-principles approach is inherently relative. It is based on how humans think things work, with the aim of eliminating “impossible” outcomes.

This is done so problem solvers can narrow down hypotheses in order to focus the attention on smaller actionable chunks. Not only does this break down problems into simpler sections, it also enables targeted delegation and the ability to deploy multiple people on larger problems.

I love the example of Musk’s SpaceX. He basically said fuck all the noise (I’m probably paraphrasing) and re-engineered a rocket from the ground up (pardon the pun). He did so to prove (1) he’s a maverick and (2) we can build rockets at a fraction of the cost. He used a first-principles approach - he looked at each component part and stripped all the stuff that wasn’t necessary. He redesigned the rocket. Then he looked at the commodity prices of the remaining component parts. Voila - peanuts.

Watch Musk explain first-principles below (in only 3 mins):

But while first-principles have helped us get exceptionally far, this thinking may be limiting going forward.

Part 3: Zero

Bryan Johnson is the founder of Braintree Venmo, CEO of Kernel and a VC to boot (don’t forget, everyone’s a VC these days). He wrote a brilliant piece on Zeroth-Principles Thinking that shows why we need an approach from zero.

He whittles this piece down into a few minutes with Lex. Watch below if you want an introductory insight into his thinking (c. 8 mins):

One sentence from the entire 2.5-hour interview resonates with me, which is reflective of the zero-based approach that Einstein took:

“Imagination is everything we could potentially know in the future, while knowledge is just what we know today.”

Einstein would famously use thought experiments, what us mere mortals would deem daydreams. He could reduce abstract concepts to everyday scenarios that would simplify the core concepts of complex physics into testable theses. All in his head.

Apparently, one afternoon Einstein looks out of his window. He sees roofers working on a building opposite and realises if they were to fall they would no longer experience gravity in the same way - they would feel weightless. Much like if a man were to be in an elevator, he does not know if the elevator moving up is pushing him down or if it is a gravitational pull. This helped him envision space-time and test Newton’s theory of gravity that ultimately led to his General Theory of Relativity. He would later recall this realisation as the happiest moment in his life.

It was this young physicist’s imagination that set him apart. He needed to think outside the box (or elevator) to fully test Newton’s theories. The next generation of problems require an approach that may be outside the bounds of first-principles, simply because they appear impossible today. Wormholes, time travel, escaping black holes, alternate dimensions all seem like science fiction, but could and may need to be solved in the upcoming millenia.

With evermore complex and existential problems emerging for humanity, the need for original ideas increases. Johnson argues that to be truly original there needs to be a detachment from traditional incentives and traditional human structures; an ability to separate from our innate human condition. He gives examples such as motivation beyond social status / wealth accumulation and the demise of tribal proclivities.

My (extremely minimal) understanding of history is that the human condition is hard wired for these things. Or at least the majority of human history highlights this. Correlation =/= causation but we have a tendency to want; be it wealth, power, freedom, influence.

So how do we decouple? Technology.

Part 4: 0 + 1 = ∞

Don’t get it twisted, the technological revolution is in its first innings. In a world where money is cheap and plentiful, the “tech” bandwagon is overspilling with hitchhikers. We have a remarkable number of companies emerging that chuck the word AI in their pitch decks hoping to increase their valuations 10-fold. They’re only reacting to a market that is responsive, so I don’t particularly blame them. And I think the real tech companies will be victorious in the long run. But when I say real tech, I mean truly technical companies that are deploying engineering and scientific feats of superiority. Some call this deeptech, but the term insinuates deeper tech may not emerge, while branding other tech as shallow. I don’t like this as all technology is technology and soon deep tech will just be normal tech.

But as larger and more dangerous problems become a reality in our societies, these technological breakthroughs become increasingly necessary for our survival.

Adopting a traditional approach to solving problems may hinder this process, and given I think humans are hardwired to repeat or look to the past, we must rely on something alien.

Technology can be taught to learn in a way that is different from us. As Johnson states better than I could:

“Our co-evolutionary future with AI will introduce a record-breaking number of Zero-like building blocks, which will in turn level up our aspirations.”

He gives the example of Andrej Karpathy’s Software 2.0 vision which purposely uses human unfriendly language that people would not be able to write. And the value in this is the ability to unlock further potential.

Einstein’s General Theory of Relativity was pushed to the wayside for decades, and only with the further development of black-hole science were we able to understand his theories in a new light; something Einstein did not expect, nor understand during his time.

Part 5: Smoke Your Own Pipe

By enabling the building blocks of zero to emerge, we give birth to new ideas. And that’s all we need to do. New ways of thinking about things we struggle to fathom today. And with our inherent human biases we need new tech to help us break through these constraints.

This does not mean we don’t use first-principles either. We just move chronologically: starting with a zero-based impossible-is-nothing approach and then layering on first-principles to test multiple spawning hypotheses.

But of course, this does not apply to every scenario. There is still inordinate value in a first-principles approach, especially as most of the problems we work on as founders, investors, advisors etc. require a more constrained understanding of reality.

But as technological innovation develops in lieu of growing global and universal issues, we should at least aim to utilise this thinking in the businesses we create, and the companies we invest in. We need to break free of the public schooling system that makes us learn through memorisation, and relearn how to utilise and reward imagination.

Our young physicist Albert Einstein went on to be revered as the symbol for genius. He was great mates with Charlie Chaplin, who would joke that people loved him because they understood him, while they loved Einstein as they did not. That’s the beauty of the zero approach - it may not need to be understood by us, at first, but it is beloved.