Melinda French Gates speaks onstage at an event in the spring. <\/p>\n
With an estimated net worth<\/a> of US$29.3 billion, Melinda French Gates can easily bankroll her daughter\u2019s business without breaking a sweat. But at a recent summit, the billionaire philanthropist confirmed she\u2019s not funding the new venture.<\/p>\n Gates didn\u2019t say which of her two daughters she was referring to, but 22-year-old Phoebe Gates recently launched Phia, an AI-powered shopping app. \u201cI wouldn\u2019t put money into it,\u201d Gates told host Amanda Davies<\/a> at the Power of Women\u2019s Sports Summit presented by e.l.f. Beauty in London.<\/p>\n By holding back her financial support, Gates says her daughter gets the chance to test and validate the business idea with real investors and customers. If it\u2019s a \u201creal business,\u201d Gates says, the venture will eventually find people willing to back it.<\/p>\n Phia has already attracted outside capital. According to GeekWire<\/a>, the startup has raised US$850,000, including US$100,000 from Soma Capital, a US$250,000 Stanford social entrepreneurship grant and US$500,000 from angel investors such as Kris Jenner and Desiree Gruber.<\/p>\n Phoebe Gates and her cofounder, Sophia Kianni, have also secured a podcast deal to promote the venture.<\/p>\n Phoebe’s journey offers some valuable lessons for anyone looking to start a business.<\/p>\n The odds will most likely be stacked against you, with the most common pitfall being that you’re building something nobody wants to pay for.<\/p>\n To avoid this trap, try to find relatively cheap and quick ways to validate your business idea. Pitch the idea to angel investors or industry experts to see if they would bet real money on the venture\u2019s success.<\/p>\n Better yet, look for paying customers to validate your business idea before you sink too much of your own money into it.<\/p>\n Statistics Canada\u2019s 2020 Survey on Financing and Growth of Small and Medium-Sized Enterprises<\/a> recorded 76% of all Canadian small- and medium-sized enterprises (SMEs) used their personal finances to launch their business, and 13% relied on loans from friends or family.<\/p>\n The same survey also found that in 2020, 75.9% of SMEs applied for government financing, another 7.3% requested a line of credit<\/a>, while 5.9% requested a business credit card to financially support their venture.<\/p>\n Additionally, a 2017 Competition Bureau study<\/a> shows almost 50% of SMEs rely on informal financing such as personal funds or loans from friends and family, and approximately one-third turn to credit cards as a financing method.<\/p>\n If you\u2019re launching something new, first think about how to attract real customers. For example, you could build a waitlist of clients who have already signalled interest in your product or service. You might also collect early deposits or presale revenue to help fund development.<\/p>\n Getting those early customers will take time and effort, especially in marketing, but it brings two major benefits: proving there\u2019s real demand and creating early cash flow to support your growth.<\/p>\n Read more: What is the best credit card in Canada? It might be the RBC\u00ae British Airways Visa Infinite, with a $1,176 first-year value<\/a>. Compare it with over 140 more in 5 seconds<\/p>\n 1. Forbes: <\/a>Melinda French Gates (Sept 11, 2025)<\/p>\n 2. Fortune: <\/a>Melinda French Gates reveals she\u2019s refusing to fund her Gen Z daughter\u2019s startup\u2014despite being worth nearly $31 billion by Orianna Rosa Royle (Jul 8, 2025)<\/p>\n 3. GeekWire: <\/a>Phoebe Gates launches e-commerce startup \u2014 here\u2019s what her famous parents think by Kurt Schlosser (Apr 25, 2025)<\/p>\n