Welcome to Episode 11 of Thanks for Thinking, the music business podcast centered around self-reflection and proactivity for thoughtful music production professionals.
I’m your host, Carl Bahner.
Today’s topic: The Blurry Line Between FOMO & Opportunity Cost
As freelance creatives, every time we’re presented with the opportunity of taking on a new project, we need to ask ourselves: should we do this?
Now, if we’ve talked before, or if you’ve read the chapter in my course that talks about determining your ideal potential clients, you’ll know that there are actually a LOT of other questions that I ask myself before taking on a project. And the majority of those questions help me to figure out whether or not I’m the right fit for the project and whether or not the project is the right fit for me. But today, I’d like to focus on a more purely logistical consideration - do I need to take on this project? And is it worth my time?
Unless you live under a rock, you’re probably familiar with the term “FOMO” - the fear of missing out. Many freelance creatives are guilty of letting FOMO dictate project scheduling decisions at one point or another. You know what I mean - taking on a project that we knew would be really difficult to fit into our schedules. And once we’ve said “yes” to the project, we don’t want to let our clients down so we inevitably make compromises to other projects, our personal schedules, or, sometimes, unfortunately, our physical or mental health.
Most times that FOMO scares us into these situations, it’s driven by money fears. A lack of financial security, and being afraid to turn down the money.
But many of us don’t take into consideration one very, very important aspect - the opportunity cost of saying yes. There’s a link in the show notes to an article that I feel defines it pretty well. But in short, opportunity cost is the value of the other future opportunities that you’re turning down by saying “yes” to a particular project or task.
I’ll use myself as an example. I charge flat prices to mix a song rather than a price per hour - so the longer a mix takes for me to finish, the less money I make, on average, per hour. So my “average hourly rate” is the total price I charged for the project, minus any costs, and then dividing that number by the total amount of hours it took me to complete the project.
Many producers and mixers are hesitant to delegate tasks to other engineers, because of FOMO - they don’t want to pay someone else to do a task that they could do themselves. But when you do the math, a lot of times it’s more profitable to delegate. A lot more profitable.
One task that I’ve delegated for the past few years is mix session prep. Taking the files that were sent to me by my clients to mix, and then putting them into my mix template, making sure everything is organized, color coded, etc.
Let’s consider these three things:
- How much time it would take me to do the prep myself (and therefore how much time is freed up to do other things),
- How much money I need to pay an assistant to do the prep, and
- How number one and number two affect my average hourly rate.
Ok, real example. Let’s say I pay an assistant $15 per song to prep a mix, and the average prep would take me 30 minutes to do. So, when I calculate my average hourly rate (the total price I charged, minus the cost of hiring the assistant, and then dividing that by the number of hours it takes me to mix it), I can compare that number to the hypothetical $30/hour I’d be “saving” by doing the mix preps myself.
I’ll be fully transparent and say that at this point in my career, my average hourly rate for mixes ends up being around $150 an hour - sometimes more, sometimes less. So why would I spend my time prepping my own mixes when I could be spending that time doing more mixes, essentially making a higher average hourly rate? Or, I could spend that time doing outreach to get new clients. Or, I could be spending that time working on my business. Or, spending that time with my friends and family.
Ok, so I initially said this was a purely logistical consideration, but truth be told, there are some emotional considerations involved with opportunity cost. And when I said opportunity cost is the value of the other potential opportunities that you’re turning down, that value isn’t purely monetary.
Here’s another example. Let’s say you were going to hang out with some friends on Saturday, but you had an artist reach out to work with you, are happy to pay your full rate, but here’s the catch - they’re under a tight timeline and can only do Saturday, at the exact same time that you were supposed to meet up with your friends. If you can’t do it at then, they’ll need to go elsewhere, so rescheduling is not an option.
On the one hand, you could make some unexpected money. But on the other hand, you’d have to cancel plans with your friends.
“That’s easy, do the session and just see the friends another time.” Well, that may be easy to do if you see these friends all the time.
But what if you worked the past 10 days back-to-back and Saturday was gonna be your first day off? Or what if it was the first time you were going to see these friends since the pandemic started? Or, what if they’re moving out of townthe next day and this is the last time you’ll see them for who knows how long? Or what if it’s a celebration of life for a friend who recently passed away?
See, opportunity cost is much more nuanced than just “how much money would I be giving up.”
Find a comfortable spot without distractions. I’d like you to spend the next few minutes thinking about times in your career when FOMO caused you to make regrettable decisions.
Today’s reflection question is: what are some times in my life or career that FOMO did more harm than good?
When I say regrettable decisions, I don’t mean buying a fedora in high school and making it “your thing.” I mean missing a family event for work, only to realize that the client who hired you was a giant pain in your butt or the paycheck ended up being so small that you wish you could buy your time back. Because the reality is - we can’t buy our time back. And unfortunately, a lot of small business owners like us get FOMO about money… when really, I’d argue that it may be healthier to have a fear of missing out on life.
So once again, today’s reflection question is: what are some times in my life or career that FOMO did more harm than good?
I’ll be back in a few minutes.
If you need more time, hit pause and come back when you’re ready.
Now, the purpose of that exercise was not to make you feel guilty or remorseful about those times in your life when you let FOMO get the best of you. The purpose is to make you more aware of what tempts you into FOMO, and how you can be more conscious about it when you’re tempted again in the future. Because, let’s face it, you will be tempted again in the future.
So, let’s take what we’ve learned about ourselves and apply it.
To complete today’s action item, all you’ll need is a word processor, or a pen and paper.
Today’s action item is: write down a clear, step-by-step list of each action in your typical workflow for a project, then go back through the list and mark down the average time each step takes to complete.
I think you’ll understand my reasoning for having you do this a little bit more after the exercise, but for right now I don’t want to influence your thoughts too much.
Alright, time to get started. I’ll be back in a few minutes.
If you need more time, hit pause and come back when you’re ready.
If you were able to make a confident estimate of the average time each of those tasks takes, that’s great! Because now you can look back through the list to see if there are any tasks that you’d maybe prefer to delegate so that you can spend that time doing other things.
And if you had a difficult time making confident time estimates, well believe it or not that’s great too! Because this brings to your attention the fact that you’re not totally sure how much time each of these tasks takes.
“But every project is a little different” may have already gone through your head while you’re listening to this. But this is why having accurate time estimations for your project tasks - it’s so important. And the first step to avoid making bad FOMO decisions is to have a firm, reality-based grasp of how long projects will take you to complete.
One method that worked for me was to open the stopwatch app on my phone and time myself doing each task. Not necessarily for the purpose of doing it faster, but just gather some actual data instead of just… going off a hunch.
Personally, I found that the least intrusive way of doing this was to start a task and hit the “start” button on my stopwatch, and then when I moved on to the next task, I just wrote down that time on a sticky note and restarted the timer. At the end of each day I would put the times into a spreadsheet so that I could look back at the average time each task took to complete.
I did this process for about a month and the biggest takeaway for me was realizing the insane amount of time I was spending on printing mix stems. And at first I started delegating that to an assistant who would print them for me using Zoom’s remote keyboard control feature, but it was not the most efficient or convenient way to do it. It was still better than me doing it myself, but not by much.
So when I tried a demo of Chris Graham’s “Bounce Butler” app, I was a bit hesitant to spend the $49 per month to use it. What this app does is it basically uses AI to do all of that stem printing for me. I downloaded the app to give it a shot, and in the very first night of me using it, I only had to do about 20 minutes of work to actually prepare the software to do what I wanted it to do. And I was able to print seven songs worth of mix stems while I was sleeping. Now, that same process would’ve taken myself or my assistant close to seven hours to do without this app.
And for the record, Bounce Butler is not a sponsor or anything. This is just a practical example of how i’ve been able to use the workflow time estimation data that I took with my stopwatch to make more informed decisions. $49 a month seems like a lot of money, but that first night alone essentially saved me enough time and money to justify paying for the first two month’s worth of subscription fees. It was the easiest $49 I had spent in a very, very long time. Again, not a sponsor, just a real-world example.
They say “time flies when you’re having fun” and if you enjoy the work you do, like many of us do, you may be spending way more time doing certain tasks than you even realize. Or, you may be spending way more time checking facebook or tiktok than you realize, but that’s a conversation for another episode.
I hope you learned something about yourself today. Maybe it was something small, or maybe it was a significant revelation. As far as I’m concerned, any growth in your self-awareness enhances both your business and your life.
If you found this episode helpful, please like, subscribe, and share this with someone you feel would benefit from exercises like these. You can join the Discord Community using the link in the show notes, connect with me on social media at @carlbahner and @thanksforthinkingpodcast, or reach out directly to info@carlbahner.com
Until next time - Thanks for thinking.