Technology and mentoring go hand-in-hand

It seems difficult to be in a conversation these days without being drawn into speculation on how things will change with US President Donald Trump back at the White House. From tariffs to immigration to global security, no matter how seemingly distant the events of Washington are from Manila, the ripples are expected to be felt here in the Philippines.

Of course, the most obvious effects are how this will affect Filipino immigrants, our trade with the US and security in the region. What I have observed with some interest, however, is the ban on TikTok.

To continue its operations in the US, TikTok is being asked to sell to a non-China-based company. Former US president Joe Biden signed the “Protecting Americans From Foreign Adversary Controlled Applications Act” in March 2024 and the US Supreme Court subsequently upheld this. TikTok went dark for a few hours last Jan. 18 until President Trump gave it a 75-day extension.

I know, I know. The fate of a short format video sharing platform popular with Gen Z is not something that would normally interest someone past the age of 60, but I follow it to see how it will affect small businesses in the US. Also because TikTok is growing as a preferred platform of choice for many Filipino MSMEs.

One report said that according to TikTok’s own estimates, the shutdown could cause some $1 billion in lost revenue each month from small US businesses that will lose access to the platform. These range from mechanics to babysitters to bakers and other small entrepreneurs who rely on social media to attract customers and fulfill orders.

These are small businesses in the US that have no advertising budget or sales force, and yet find in the platform a place where they can do business without needing too much capital for overhead expenses. It was so effective for small businesses that one news story reported that a mobile mechanic said she gets two to three customers a day because they saw her content on TikTok. Business was so good she was able to build a shop and hire people.

Stories like this are not unique to the US. The small entrepreneurs we welcome at our Go Negosyo events tell us how social media has helped them sell their products and services. In fact, it is not unusual to find social media live sellers and online-only sellers among the nano- and micro-entrepreneurs; they sell everything from bagoong to hair accessories to home massage services and kids’ tutoring. There’s also a continuous stream of social media influencers and content creators – one born every minute, it seems – that constantly refresh the pool of local talent out there. The Philippines is among the top, if not the top, user of social media in the world; it has the seventh-largest user base for TikTok and sixth for Facebook.

There are alternatives like Instagram, Facebook Reels, SnapChat and short videos on YouTube, but from what I understand, it is TikTok’s algorithm that really levels the playing field. Unlike other platforms which charge a fee to push content to new audiences, popularity on TikTok depends on the content itself and how effectively it engages with users. That’s why TikTok is often on the cutting edge of new content and why so many of the younger people are hooked on it. It’s also the reason many nano- and micro-entrepreneurs probably feel they have a fair chance of competing for attention when they use TikTok. They don’t have to be born with third-base social media (or real-life) connections to leapfrog their way to popularity and profitability.

I have talked several times about social media and digital technology and how I believe they can be game changers for our MSMEs given the new e-conomy. Our young, digital-savvy population took to the new tools quickly, leading even the older generations to adopt and learn how to use these new tools. That’s why TikTok’s shutdown in the US is interesting to watch because it might offer a preview of what the local online economy might look like if there is a sudden, permanent stoppage in service, what kind of effect it might have on our small entrepreneurs and what we can do in case it happens. We don’t need a repeat of the pandemic lockdowns; we all know how devastating it was for our MSMEs.

If all goes as expected, the Philippines’ digital economy could reach $35 billion by 2025. There are plenty of moving parts, however, that still need to be secured before this can be realized. Filipinos have to continue to be encouraged to adopt non-cash payments such as e-wallets and credit cards, the infrastructure has to be present and reliable and consumers must be assured of their safety and security while transacting digitally.

Digital technology has broken down so many barriers for Filipino MSMEs. Today they have access to important tools like capital, markets and mentoring, the three essential elements of successful entrepreneurship, thanks to digital technology. Advertising and promotions were previously inaccessible to MSMEs because of the costs involved; today it’s a DIY task, thanks to social media.

That’s why it’s important to keep an eye out on both the infrastructure that supports a robust MSME e-conomy, and continue to nurture entrepreneurship with mentoring. At our Go Negosyo mentoring events, we’ve adopted topics that will be relevant to MSMEs doing business on social media, like how it’s important to generate relatable content and actively connect with customers. Alongside these, some staple pieces of advice remain, such as cultivating a positive mindset, getting proper mentoring, having multiple income streams and continuous learning. With sure and steady steps, we should be ready and able to overcome hiccups.