For the past six weeks, one story about women in tech has dominated headlines. Bloomberg reported in July that Phia , the shopping app co-founded by 23-year-old Phoebe Gates and her Stanford roommate Sophia Kianni, had been claiming affiliate commissions on sales its browser extension had not driven, a concept known as ‘cookie stuffing.’ Phia denied any intentional malpractice, initially attributing it to a bug, which they claimed to have resolved by July 7. The company said transaction reversals for affected brand partners were underway and that it planned to hire a head of compliance. This rebuttal came under new fire last week, when leaked Slack messages shared as part of the ongoing reporting revealed that Gates and Kianni had been aware for months.

Phoebe Gates’ surname inevitably drives headlines. The less visible story is what came before Phia: women building in the same category with a fraction of its funding and attention. As this controversy continues, I asked two of these founders how the Phia controversy is affecting their own businesses, and what it could mean for the category as a whole.

The founders betting that real recommendations beat AI-curated ones

When Kristine Locker founded Locker in 2020, she hadn’t risen through the world of tech; she was a financial analyst at Goldman Sachs. She shared with me over the phone this week that her idea was intentionally very simple: “a place to save anything you see online while shopping, organized into a personal 'locker,' with profiles that make it social and a payback program that shares affiliate commission with whoever's recommendation drove the sale.” She had no plans to lead with groundbreaking tech, but to focus on product and market fit in a vertical she felt was ripe for user-created experiences. "It's not the super app. It's not the AI outfit generator," She said. "It's saving products, seeing what your friends are doing, feeling confident that no one is stealing your info. The features we have coming out soon lean further into human-to-human."

A Hundred No's Before One Yes

However, as is the case with so many female founders , the fundraising took longer than the product did. She bootstrapped Locker for two years before raising a single dollar of outside capital. She initially set out to raise 3 million dollars. "In our most recent fundraising round, I had over a hundred no’s total," she said. "I was told from the market that was way too much, and I needed to be raising way less." The round closed at 1 million, from a single angel, who was also an enthusiastic Locker customer.

The money was difficult to secure as the milestones kept moving. What investors wanted to see in way of concept to commerciality kept changing. "For the first raise, they wanted more users of the platform. For the second raise, they wanted revenue, which is so counterintuitive, because typically you want to remain pre-revenue as long as possible." Locker turned on revenue, reached profitability, and only then could Kristine go back to the investors who had passed.

Same Investors, Same Circles, Different Outcomes

That investor pool is where this story also gets interesting. Kristine shares that some of the funds that told Locker no later went on to invest in Phia. Locker and Phia had coexisted at a distance for years, moving in the same small affiliate-industry circles, sharing an advisor, until Phia’s product shifted. "The original idea of the business was that it was going to essentially be more like Google Flights for fashion," Kristine said of Phia’s early positioning," But about a year ago, that changed. That’s when they pivoted to our tagline, which is being Pinterest for online shopping." Kristine shared that she posted a TikTok laying out the timeline of her own product against Phia’s pivot. The response from Phoebe Gates account was three fire emojis.

When User Growth Doubled But Revenue Didn’t

The competitive tension became more consequential when it moved from social media to her balance sheet. Kristine shared that in late 2025 Locker’s user growth stopped translating into revenue, an unusual outcome in a seasonal demand business that earns more than half its annual revenue in the fourth quarter. However in early 2026 it came apparent early that the second quarter financials weren’t trending the way she expected. "Our user base more than doubled with one of our largest retail partners, but revenue was flat year over year," Locker said. Because affiliate journeys go dark the moment a shopper leaves the platform, Locker couldn’t diagnose the cause on its own and started pressing partner networks with questions weeks before Bloomberg’s story ran. Phia did not respond to a request for comment for this piece.

Cloud Closet Weighs In On A Familiar Pattern

This is all the more noticeable in a space with little room for margin miss, and a category where the funding gap is stark. This was outlined by another Fashion-tech founder Caroline Lakshmanan of Cloud Closet who took to her Substack ‘ Styled by Code ’ to voice her frustrations on how the impact of Phia’s actions extended far beyond just one companies revenue.

Cloud Closet, which Lakshmanan built after a decade in fashion merchandising and buying at companies including Gap Inc. and LVMH, faced the same funding paradox as Locker and was bootstrapped through the same stretch.

Speaking over Zoom this week, Caroline echoed Locker’s frustration about investors who passed on Cloud Closet yet quickly backed Phia. Watching Phia stock its cap table with celebrity firepower and high-wattage media access, which seemed so completely unattainable to her and founders like her hardened the blow, she shared. But what cut deepest, she noted, was watching Phia ship features that she believes closely resembled the very products other companies like Beni and Locker’s teams had spent years developing. She also points out that as it relates to cookie stuffing, Phia wasn't operating in uncharted territory: Honey faced similar affiliate-attribution accusations in 2025.

When Valuation Becomes Obligation

Her broader concern is what this does the industry and fellow female founders broadly. She refers to retail analyst Ali Kriegsman, who she quoted in her Substack framing the economics of Phia’s model, which she said, “faced critical, structural headwinds to delivering a 10x return to their investors.” She explains a 5 percent-commission business needs monolithic volume to justify raising more than 43 million dollars at a reported 185 million dollar valuation. Lakshmanan’s takeaway is clear: “A giant valuation is simultaneously a signal of success and an obligation to produce.”

What This Means For The Founders Who Built The Category First

For the founders who built in the category before Phia’s rise, the fallout presents both risk and opportunity. For Locker, the moment is less about vindication than opportunity. "If people are like, screw that, I am not using Phia anymore, then of course we want them using Locker," she says, noting they are already seeing an influx of new users.

For Lakshmanan she’s looking at the impacts past any one company but on the category as a whole. She’s said she fears this scrutiny will make fundraising harder in the near term for female founders but hopes it could ultimately force the category to raise its own bar, with what she describes as less "incentive to cut corners to meet venture returns."

In a world where female founders receive less than 2% of venture dollars , this is a moment to look at the bigger story here. One that is not about one company or famous surname but instead about the founders who were building this category first, absorbed 150-plus no’s on the way, and are still standing strong and building forward, while the questions they have been asking themselves are finally being asked more widely.