Thinking & Mental Models

First Principles Thinking Aristotle (origins); Elon Musk (popularised in modern business) Break a problem down to its most fundamental truths and build up from there — rather than copying what others do because "that's how it's done." Pareto Principle (80/20 Rule) Vilfredo Pareto, 1896; popularised by Joseph Juran, 1940s 80% of results come from 20% of causes — identify the high-leverage 20% in your business and ruthlessly deprioritise everything else. Inversion Carl Jacobi (mathematician); Charlie Munger (business application) Instead of asking how to succeed, ask how to guarantee failure — then avoid those things. Surfaces blind spots that forward-looking analysis always misses. Second-Order Thinking Howard Marks, Oaktree Capital; popularised in mental models literature Think through not just the immediate consequences of a decision but the downstream consequences of those consequences — ask "and then what?" twice. Feynman Technique Richard Feynman, 20th century If you can't explain it simply, you don't understand it — a four-step method that exposes the gaps in your knowledge by forcing plain-language explanation. Circle of Competence Warren Buffett & Charlie Munger, Berkshire Hathaway Know exactly where your genuine expertise ends — most mistakes come from acting confidently outside your circle without realising you've left it. Occam's Razor William of Ockham, 14th century Among competing explanations, prefer the simplest — complexity needs justification, and most problems are less complicated than anxiety makes them appear.