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In our many encounters with MSMEs all over the country, there are inevitably going to be the one-man-show businesses. I am talking about the “nano businesses,” those businesses run by single proprietors, “nano” being by default the smallest unit and far smaller than micro. Micro enterprises, by most definitions, employ no more than ten people. Nano businesses are what our President described as solopreneurs,” operating out of their homes or on foot, offering services such as home repair or working as manicuristas, or itinerant services like repairing shoes or selling snacks.
The President appealed on behalf of these entrepreneurs when he spoke at the 42nd ASEAN Summit last week. Addressing the leaders of the ten ASEAN member-states and their partner-states, as well as the heads of some of the biggest companies in the region, he implored them to support nano businesses, saying they have the potential to contribute to the region’s economic growth and narrow the development gap.
It came as no surprise that our friend, Arsjad Rasjid, who is the chairman of the ASEAN-Business Advisory Council 2023 and who also heads the KADIN, that is, the Indonesian Chamber of Commerce and Industry, expressed his support for the President’s call.
He was in the Philippines last February to consult with us as the chair of the ASEAN-BAC Philippines on his plans moving forward as the private sector advisers of the ASEAN leaders. Ever a champion of the small businesses, he and his contingent, all big shots in Indonesian business, gamely volunteered to mentor our MSMEs when we held our 3M on Wheels free entrepreneurship mentoring event at Robinsons Galleria.
It is during these roadshows and even on our Facebook Live show Go Negoshow that we encounter nano businesses or, as I would call them, nano-entrepreneurs. I am not surprised that there is little written about this category of entrepreneurs. They are so small that they do not even meet the criteria for micro. And yet, as the President said, they “play a very important but often unrecognized role all across our countries… They are largely unaccounted for, but these informal business settings constitute a large portion of all our economies.”
The numbers from DTI bear this out. As a group, MSMEs account for more than 99 percent of businesses in the Philippines. Broken further down, micro entrepreneurs constitute 90.54 percent. One can only imagine how many of these micro entrepreneurs started out as nano-entrepreneurs, and how many more are out there.
So how are nano-entrepreneurs different from freelancers? I suppose it is the entrepreneurial mindset. Where freelancers plug into existing organizations and provide services in exchange for a fee, nano-entrepreneurs work for themselves with a vision of one day growing a business. Nano-entrepreneurs do not stop at supplementing their income; they are focused on growth. These two, I believe, are not mutually exclusive; freelancers can blossom into entrepreneurs.
Most often these nano-entrepreneurs start out operating from their own homes. One of my mentees at the 3M on Wheels made ice candy from her kitchen and sold them in front of her house. She eventually recruited her husband to make deliveries to nearby stores and soon, to neighboring barangays. She innovated and came up with different flavors for her ice candy. She did research on the internet and figured out how to blend fresh fruits and cookies and incorporate them into her iced snacks. I imagine business is good, given the hot weather nowadays.
Another one of my mentees – a teacher – made bagoong (shrimp paste) and sold them online. She made videos and posted them online to promote the product. She was flexible and adapted as lockdowns happened during the pandemic, scaling up and trimming down as necessary. She persevered and before she knew it, she was able to buy a small property and a delivery van. No more tricycle rides for her deliveries, she now had her own van. She told me that never in her wildest dreams did she imagine herself owning property or a vehicle.
It is cases like these that I would like to see replicated many, many times across the country. Given how many of our enterprises – almost all, really – are micro, we can imagine the benefits of seeing them scale up from nano to micro, micro to small, then small to medium.
Digitalization has also given birth to many nano-preneurs. Riders of companies like Angkas and Lalamove invest in motorcycles and use the apps to access the market. Influencers and content creators use their skills to serve in the space that was once dominated by ad agencies and celebrities. These nano-preneurs turn their skills into a business, and because the tools and opportunities are democratized, anyone can enter the game and have an equal chance at succeeding.
These small entreps, up to micro, I would think, are not yet part of the formal economy. They do not yet pay taxes, issue receipts or have a payroll. But imagine if they had the path cleared so that, in time, they will be part of the formal economy. Their contribution will be substantial, just owing to their sheer number. By helping them, we create a wide base of active, dynamic businesses, able to move swiftly to adapt to difficulties and innovate as the market dictates.
They are resilient, but for far too long, have been neglected and shut aside in favor of the giants. Yet they plod on, day by day, providing us those small, barely perceptible but essential services, making and selling products we didn’t even know we needed.
The three pillars of successful entrepreneurship – money, markets and mentorship – are the same whether you are nano, micro, small or medium. Every business needs capital, a place and people to sell to, and someone to guide them along the way.