Episode Summary: How to figure out what your time and knowledge are worth, and how to create content, products, or services genuinely valuable to others — covering the definition of value, the 4 types of value, and a practical framework for pricing your own time.
What You'll Learn
- Why value is never fixed, and how economic value differs from ethical/sentimental value
- The 4 types of value: functional, monetary, social, and psychological
- A 3-step framework for figuring out what your time and knowledge are actually worth
- Why undercharging is often rooted in undervaluing your own skills, not the market's actual demand
"A lawyer's time and advice are his stock in trade." — Abraham Lincoln
What Is Value?
Nothing has a fixed value — "one man's junk is another man's treasure." Price tags may be fixed, but value lives in the eyes of the market, and it's always shifting. Economically, value is the maximum someone is willing to pay for a good or service. Ethically, it's how useful or important something is to you personally — think of the personal possessions in your house that carry sentimental rather than monetary value, or the brands you love because they align with your own core values like honesty, fairness, or kindness.
Perceived Value and Value-Based Marketing
"Value" is an online buzzword, and creators are constantly told to over-deliver on it — but the audience decides what's valuable, not the creator. As Gary Vaynerchuk often puts it, the market decides how valuable content is, through likes, shares, and comments — not the creator's own assessment. Anyone who's published something they were proud of to silence, or something they considered mediocre to a huge response, knows this firsthand.
The 4 Types of Value
- Functional value — does it actually solve the problem? A tutorial that fixes someone's issue is functionally valuable simply because it worked.
- Monetary value — is the functional value worth paying for? When a "want" becomes a "need" (learning a skill for a promotion, say), willingness to pay rises accordingly.
- Social value — does it connect people with each other? A paid community or Patreon group might have limited functional value but significant communal value — this is often one of the most underrated parts of a brand.
- Psychological value — does it make people feel better? Simple content, like a livestreamed beach sunset, can carry real emotional value even without solving any concrete problem.
The throughline: always design with the end user in mind. Does it work? Is it worth paying for? Will they meet good people? Will they feel entertained, inspired, or happy?
How Much Is Your Time and Knowledge Worth?
There's no universal formula, but a few steps help:
Figure out expenses. Know the real monthly cost of running the business and living on it. A freelance rate calculator is a useful starting point for determining an hourly number th…
Read the complete show notes and resources on mikemurphy.ai.
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