Mental Models #1: How Elon Musk Thinks Part I (Classic)

What's up, everyone. This is Alex Lieberman, co-founder, and Executive Chairman of Morning Brew. Welcome back to Founder’s Journal, my personal audio diary, where I give you, the business builder, the tools you need to think better in order to build better, whether that's building a business, a team, or a new product. We're doing things a little differently this week. We are dropping our third-ever mini-series, which means you're getting two episodes today, two episodes Wednesday, and two episodes Friday. You're listening to the first episode in the series, which is a Founder's Journal classic, and be sure to check out today's second episode on inversion as well. This week's theme is Mental Models. We're going to talk about some of the most powerful tools you can use to sharpen your thinking, your prioritizing, and your decision-making. And many of these tools have been made famous by leaders like Elon Musk and Dwight Eisenhower. Today, I am talking about a mental model known as Sum Product Thinking that was popularized by Elon Musk. Let's hop into it. 

Zero-sum, Positive-sum, and Sum-product Thinking

So I'm not going to give the Elon Musk biography. We've all heard of him. He's an eccentric entrepreneur who's worth $160 billion, CEO of Tesla, SpaceX, founder of Neuralink, Boring Company, former CEO of PayPal. And while these are accurate ways to describe Elon, I believe that for us to learn from one of the greatest entrepreneurs of our time, the Edison of our era, we need to study how he thinks versus study the products of his thinking if that makes sense. So in honor of Elon's 50th birthday, which happened earlier this week, the next two episodes of Founder’s Journal will detail what I believe are two of the most important lenses through which Elon looks at the world.  The first lens is something I call Sum Product Thinking. Sum Product Thinking is a mindset of collaborative societal progress over individual success. It's this idea of abundance over constraints. Let's compare that to zero-sum thinking. Whereas zero-sum thinking is a belief that your gain is my loss, Sum Product Thinking is a belief that your gain or my gain, both of our gains, is all of society's gain. So let's take that a step further. Some of you may have heard of zero-sum thinking and others may have not, but then there's one thing beyond zero-sum thinking, which is positive-sum thinking, and positive-sum thinking is a belief that you winning doesn't mean that I'm losing and vice versa.

So if zero-sum thinking is the idea that when we're competing, we're competing over a fixed pie that goes to you or me, positive-sum thinking is about us competing actually leads to a larger pie that we each get to participate and have a piece of. And so where does Sum Product Thinking come in here? Well, the way I look at it is, Sum Product Thinking is positive-sum thinking on steroids.This mindset doesn't just accept a larger pie through competition. It doesn't take a passive role. It actively invites competition in order to accelerate the pie getting bigger for all of us. And that is exactly how Elon Musk thinks.

But to understand how Sum Product Thinking manifests in his work, we need to understand what motivates him. And if you have ever watched an Elon Musk interview or read his biography by Ashlee Vance, it becomes very clear very quickly what this man is motivated by. Elon Musk wants to solve the largest problems that are threatening the human species. It is that simple. One of those things is unsustainable energy production and consumption, which is why he's working on Solar City and Tesla. Another one is humanity living on one planet, which could lead to a mass-extinction event, which is why he's working on SpaceX. And once you understand how simple and focused his motivations are, it becomes super easy to understand why he's a Sum Product thinker. The problems he’s solving aren’t just massive, with unlimited market potential. They are also long-term, life-threatening problems for our species. It is bigger than any one person. So from his perspective, the more he can invite competition, the more he can encourage collaboration, the greater the possibility of innovation that advances humankind. And so, while I haven't heard him say this, I can assume that society becoming multi-planetary so a single event doesn't wipe us out and society becoming more sustainable so we don't basically wipe ourselves out, it is more important to him that it is solved overall then him being the person that has to do it. 

A real-life example from Elon

So here's an example for you. In June of 2014, Elon published a blog post on Tesla's website that was titled, “All of Our Patents Belong to You.” It's such a counterintuitive idea, but what Elon did was he basically in this post described how Tesla removed its wall of all of the company's patents from the lobby of its Palo Alto headquarters, because he realized how counterintuitive having patents were to Tesla's North Star. Tesla's number one goal is to accelerate sustainable transport, full stop. And he came to the realization that patents were slowing this process down. And it's such a wild thing to think about. Any other company would use patents as a competitive strategy to continue to grow and make money versus their competitors. But the way that you want it is thinking about everything. This Sum Product mentality, it's all about creating the right future, irrespective of who does it. 

Elon even said that at first, when he started Tesla, he thought patents were necessary because large car manufacturers would steal their technology and use their massive marketing, sales, and manufacturing engines to put Tesla out of business. But over time, he evolved in his way of thinking. He found that, unfortunately, electric car programs at these large companies like GM, Ford, Subaru, Toyota, they were way too slow to develop. And Tesla on its own would not be able to solve the carbon crisis that's happening on our planet. And so by taking a Sum Product mentality and treating electric vehicle technology almost like an open source software project, Elon enabled an entire industry, the automotive industry, to move forward faster, to attract best-in-class talent and engineering, because now that's where the innovation was happening. And hopefully at the end of the day, propel society forward into a more sustainable future.

Now I'd love to hear from you, whether it's about this episode or past Founder’s Journal episodes, I'd love to hear any feedback you have for the show or just ideas in general. And if you're a longtime listener and you just want to say what's up, send me an email at alex@morningbrew.com or DM me on Twitter @businessbarista. Thanks so much for listening to Founder’s Journal. And if you enjoyed, please let others know who you think would enjoy the show as well. Thanks again, and I'll catch you next episode.