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First Principles Thinking: Problem-Solving for Startups

December 3, 2024
Sai
Sanjith Ballal
Priya Poddar
Gayatri Jayaprakash
Forum Desai
Prabhat Bedida
Sai
Mritunjay Kumar
Aenakshee Roy
Indu
Nikhil Pai
Gaurav Jaiswal
Divya Prabhakaran
Anshuman Agrawal
Nakul Vinod
Mohammed Asif Suhaib
Pracheta Nayak
Sumiran Dhamaskar
Piyush Adwani
Sathya Rajeev
Amrutash Misra
Amrit Vatsa

First Principles Thinking: Problem-Solving for Startups

How do startups solve problems no one’s solved before? By questioning everything. In this piece, CoreVoice leadership—our co-founder and head of strategy—share personal insights in a deep conversation. They break down First Principles Thinking—what it is, why it works, and how startups can use it to tackle challenges and drive growth in a complex, ever-evolving landscape.

How do we think? Why do we do things? In life, we often reason by analogy; i.e, we do things because it seems to be working for others- its human nature to follow patterns. Children mimic their parents, and we mimic our peers. And this works reasonably well. But the startup world is wild, filled with uncertainties, rapid changes, and unexpected challenges. Here, only sticking to whatever you already know and do can stagnate your problem solving. 

What can help however is First Principles Thinking- or as Amrutash Misra, the Co-Founder of CoreVoice puts it “...its all about break[ing] down the [problem], reframe it and logically build the solution from scratch”. You actively question all your assumptions, strip back all the layers right down to the basics of what is fundamentally true- i.e., the first principles. You then focus on what really needs to be done and build your solution from the ground up. 

Before starting this piece, my colleague Priya Poddar and I discussed how to approach it—and in that, we found an example of First Principles Thinking. She said, “The only rule to writing is that there aren’t any—beyond the fundamentals.”

What matters is that your writing is coherent and that it conveys something to the reader. Everything beyond is fair game. Now ask yourself what truly matters in this process. Is it the structure, or is it the authenticity and originality of the voice? You can write without being constrained by conventional rules- it's about telling stories in your own way. 

Priya’s idea reminded me of Elon Musk’s approach to First Principles Thinking. When he set out to build SpaceX, his goal was to make space travel affordable to support a sustainable colony on Mars. Instead of relying on the aerospace industry’s costly standards, Musk broke down the fundamentals, challenging assumptions about why rockets were so expensive. He analysed the core materials of a rocket and costs, reconstructing his approach from the ground up. The result? Rockets at a fraction of the usual price—achieved by focusing only on what truly mattered and discarding the rest.

How can startups solve their unique problems using first principles thinking?  At Corevoice, we believe in going back to the basics- where you don’t just solve problems, but rethink them. I recently captured a conversation between our Co-Founder Amrutash Misra and Head of Strategy, Anshuman Agrawal where they dig into how the First Principles approach has helped them navigate the startup landscape.

Applying "First Principles Thinking" to problem-solving in a startup environment

According to Amrut, first principles thinking is all about going back down to the basics and not following other’s rules. It's about "asking more questions, breaking it down, going back to the assumptions, checking if the assumptions are right... and then building an argument from scratch again." 

When handling clients, especially as startup consulting firms, we are tempted to always stick to our pre-existing frameworks, guidebooks, case examples etc. As Amrut humorously outlines, 

”The first instinct is, have I seen this exact same problem in my career before? Let me use that solution. Next let me see if somebody else has faced the same problem. And use that solution.”

It is only when you consciously think beyond do you reach the third step where you break this down, ask questions and figure what it boils down to. When we truly understand the problem, we can reframe it- shifting the focus to what matters instead of what seems obvious. This is especially important as startups as we don’t have playbooks that can tackle our unique challenges- so thinking from the first principles becomes a necessity. But it is also about finding a balance. As Anshuman explained, “You don’t always have to go to first principles or reinvent the wheel.” Over time, you develop a sense of when a "tried-and-tested solution can fit just right." It’s about knowing when to dig deeper and when simplicity is enough. 

Applying First Principles in Diverse Domains: The Power of Generalist Thinking in Specialized Industries

As consultants, we’re met with quite a bit of skepticism due to our lack of sector-specific expertise- a challenge we’ll have to be prepared for while working with clients across industries. However, somebody who is a little detached from your domain can bring a fresh perspective to the problem. “You’ll find it's almost like Occam’s Razor,” Anshuman quips,  “The simplest solution is often the most elegant one.” 

Be confident that outsiders like us can bring a fresh set of eyes to the problem. As Amrut puts it, “Being a bit ‘dumb’ to a field is actually a feature, not a bug.”. Because we know less, we ask questions the client might have already taken for granted.  We spot connections that might seem invisible to those immersed in the problem every day.

Ultimately, our role at CoreVoice, especially as marketing consultants, isn't about mastering the technicalities- our clients can do that themselves. Most of the business problems and marketing problems do not depend so much on the industry or the domain that they belong to. You get to focus on the core business principles and issues. “How you're speaking, how you're communicating, are you listening to your customer?…..- are crucial, no matter the industry”, says Amrut. So our problem solving does not rely on industry specific standards or knowledge- allowing us the leeway to really break the problem down logically. The perspective of a generalist, especially when they can “think from scratch” really helps when it comes to crossing domains. 

The Role of First Principles Thinking in Organisational Growth

When an organisation is formed, the first objective is obviously to develop the product, get sales, increase revenue.. You know the rest. If that doesn't happen, there is no organisation… and there's definitely no organisational growth. But at some point, your focus has to incorporate an equally important objective,- How are you going to grow this organisation?

This is where first principles thinking becomes invaluable. You apply them in the context of your startup to truly understand what an organisation means to you.  Amrut put forth questions you must answer “What is important to me? What, what impacts you? What is the, uh, what is the culture you want to bring? What is the statement you want to give through your body of work?”

The growth challenges associated with startups are a whole new ball game compared to large companies. With the latter, there’s a span of control, well-defined frameworks and structured approaches are the norm. But for startups, this kind of rigidity does not always fit. There is a lot of scope for fresh, original thinking. Anshuman provides a great analogy:

“it's like an infant- a  child's mind is constantly thinking. you're ten and you start thinking about how you're going to be when you're 18…..From an organization's point of view in its growth phase, it should keep thinking about what kind of organization it will be”

For startups, everything is still evolving, there is hardly any documented wisdom on these specific questions. As the company expands, you visualise the needs and almost always tend to solve problems as they pop up organically. “It is unlikely that you can solve [these issues] without first principles thinking” Anshuman argues. You problem-solve organically at each stage and you reorient yourself to see what can help you achieve growth.

Building the Right Team with First Principles

When it comes to team-building, startups often fall into the trap of hiring people without assessing their own needs. As Amrut aptly puts it “They think I need this role, and they copy the JD from somewhere else. They just literally take one person and put them there.” The result? You have a poorly thought out role, and a hire that is not suited to it either- an entire mess. 

This is why it's important to take a step back and think from scratch what my organisation needs- really get into the first principles.  It's important to analyse the total work you do, how you break it down between people, what skills are required for the job(s) and so on. You can take a look at how we at CoreVoice solve for hiring as startups here

You define roles based on your context- specific needs, even if that means creating new roles that aren’t defined yet. Here, we must distinguish between roles that require first principles thinking and those that primarily focus on execution. As Anshuman succinctly put it “There are roles where, um, the person is required to solve an undefined, unstructured problem and there are roles where you execute existing solutions.” Both are equally necessary and you need to hire the right people for both sides.  You must define these rolls very well- rewrite them from scratch if required and make sure this shines through in your JD. This way, you hire the right people, with the right skills and mindset for the right job. 

First Principles Thinking is all about cutting through the noise and focusing on what truly matters. At CoreVoice, we’re passionate about helping tech startups with their brand and marketing challenges. We rethink problems from the ground up, building strategies to tell stories that resonate. If you’re ready to unlock your startup’s potential and tell your story in a way that stands out, let’s talk. We’d love to hear from you.