Why Melinda French Gates Refused to Fund Her Daughter’s Startup

NEW YORK — Phoebe Gates, 22, co-founded Phia with her Stanford University roommate, Sophia Kianni, a prominent environmental activist and founder of the nonprofit Climate Cardinals. The digital fashion platform compares clothing prices across more than 40,000 retail websites to help consumers find competitive deals.

Melinda French Gates, whose personal fortune is estimated at $34.5 billion, recently said she chose not to fund the company when her youngest daughter sought outside capital. “She got capitalized not because of my contacts, not because of me. I wouldn’t put money into it,” French Gates said at the Power of Women’s Sports Summit, presented by E.l.f. Beauty.

French Gates has spent decades working to dismantle the barriers facing women in business. Through Pivotal Ventures, the investment and incubation company she founded in 2015, she has targeted systemic obstacles affecting women in the United States, particularly in technology and venture capital.

The fundraising environment remains especially difficult for female founders. Female-led founding teams secured just 2.3% of global venture capital allocation last year, according to industry data. “It is very, very hard to get your business funded if you’re a woman,” French Gates said. “And so you do have to learn a bit how to have the courage to play the game and to stick with it.”

Her decision regarding Phia was also connected to what she wanted her daughter to learn from the fundraising process. “If this is a ‘real business,’ then others need to be willing to back it,” French Gates explained. She said she wanted Phoebe to experience the professional growth that comes with market rejection. “That’s what I told her. She’s growing from this.”

Phoebe Gates graduated from Stanford in 2024, after her parents blocked her from dropping out to launch the startup. That decision contrasted with the path of her father, Microsoft Corp. co-founder Bill Gates, who dropped out of Harvard University in 1975 to build what became the world’s largest software company.

Phia has drawn scrutiny in the tech sector despite its high-profile founders. Allegations have claimed that the platform took credit for retail sales it did not directly drive.

On her YouTube series, *Moments That Make Us*, French Gates described resilience in adversity as a defining trait among successful women. “I saw that going through something difficult changed all of them, and that they had to learn to find resilience somewhere,” she said. “And in finding that resilience, they found themselves.”

Tennis champion and gender equality advocate Billie Jean King joined French Gates on stage at the summit. King praised Phoebe Gates’ determination and urged entrepreneurs to reconsider how they view setbacks. “I don’t think it’ll ever fail—she’ll get feedback from every situation,” King said, adding that she has banned the word “failure” from her vocabulary. “When people start thinking about failure, it’s a very negative feeling. Turn it inside out by asking yourself, ‘What’s the feedback I’m getting from this?’”

The hands-off approach to Phoebe’s business follows the wealth distribution principles Bill Gates and Melinda French Gates established during their 27-year marriage, which ended in divorce in 2021. The former couple co-founded the Bill & Melinda Gates Foundation in 2000.

Their three children—Jennifer, Rory, and Phoebe—are not expected to inherit the bulk of the family’s multi-billion-dollar estate. Bill Gates has publicly said they will receive “less than 1%” of his fortune, while most of the wealth will go toward global health, education, and development initiatives.

French Gates stepped down as co-chair of the Gates Foundation in May 2024 to pursue independent philanthropic projects. As part of the agreement, she received a $12.5 billion payout from Bill Gates.

The Giving Pledge, launched in 2010 by Bill Gates, Melinda French Gates, and Berkshire Hathaway chairman Warren Buffett, encourages the world’s wealthiest individuals and families to dedicate most of their wealth to philanthropy during their lifetimes or through their wills.