Insights

The recent debate surrounding Phia, the fashion-tech startup co-founded by Phoebe Gates, has sparked an uncomfortable conversation about venture capital and founder privilege. The shopping app was accused of cookie stuffing and taking credit for sales it did not generate. The problem has apparently been fixed.

To be clear, Phia is not Theranos. Theranos was a company that promised to revolutionise blood testing, attracted some of the world's most influential investors, achieved a valuation of US$9 billion, and ultimately collapsed under the weight of fraud.

The circumstances are very different, and the Phia situation is still evolving. Yet it is striking how quickly commentators have begun drawing comparisons with the Theranos founder and now FPC Bryan in-mate, Elizabeth Holmes. Whether those comparisons ultimately prove fair is almost beside the point.

What the discussion has exposed is something much bigger.

Why do some founders seem capable of raising tens of millions of dollars before proving their product, while thousands of entrepreneurs with stronger businesses struggle to secure even modest funding?

For anyone building a company in Africa, that question feels painfully familiar.

Capital Doesn't Always Follow the Best Ideas

Venture capital likes to believe it backs innovation.

In reality, it often backs confidence.

More accurately, it backs signals of confidence.

Who introduced the founder?

Which university did they attend?

Which accelerator accepted them?

Who is already on the cap table?

Which well-known investor invested first?

How many influential people are prepared to stake their reputation on this individual?

None of these questions directly measures whether a business will succeed.

Yet they often determine who gets the first meeting.

In Silicon Valley, founders with the right network can raise substantial capital based largely on a compelling vision of the future. Investors expect the business to evolve after funding.

Across much of Africa, founders are expected to arrive having already built that future.

The Impossible Standard

Many African entrepreneurs find themselves caught in a paradox.

Investors ask for audited accounts before meaningful revenue exists. They want evidence of market demand before providing the capital needed to scale. They expect experienced management teams before founders can afford to hire them. They ask for governance structures that are usually built after investment, not before it.

In effect, many African startups are expected to become Series A businesses before receiving pre-seed funding.

That is not because African entrepreneurs are less capable.

It is because they operate in ecosystems where trust is far more expensive.

The Geography of Trust

America's greatest competitive advantage is not simply that it has more money.

It has more trust infrastructure.

Universities produce founders. Accelerators refine businesses. Lawyers understand venture capital. Experienced entrepreneurs become angel investors. Specialist journalists tell startup stories. Customers are willing to trial new products. Investors can call dozens of people who understand the market before making a decision.

Every institution reduces uncertainty.

Africa has exceptional entrepreneurial talent.

What it lacks is enough institutions that systematically reduce uncertainty for investors.

When investors know less about a market, they naturally become more cautious. That caution often translates into higher standards for African founders than would be expected elsewhere.

We Must Also Be Honest With Ourselves

It would be convenient to blame international investors entirely.

The reality is more nuanced.

Many African businesses are not genuinely investment-ready.

Some founders confuse valuation with value. Others spend months perfecting pitch decks while neglecting financial controls. Governance is often an afterthought. Customer acquisition economics are poorly understood. Financial reporting can be inconsistent.

Investors are not simply buying an idea.

They are buying confidence that the business can survive.

This is where Africa also has work to do.

The continent does not simply need more capital.

It needs more businesses that are prepared to receive it.

The Quiet Success Story Few People Talk About

Fortunately, this is already beginning to change.

Over the past decade, a growing number of accelerator programmes have emerged across Africa to help founders bridge the gap between innovation and investment readiness.

Programmes such as Google for Startups Accelerator: Africa, the Visa Africa Fintech Accelerator, Accelerate Africa and GrowthAfrica have supported hundreds of founders across sectors including fintech, health, agriculture, logistics and artificial intelligence.

Collectively, these programmes have helped startups refine their products, strengthen governance, improve investor communications and raise follow-on funding. Alumni from these ecosystems have gone on to secure investment from globally recognised venture capital firms, expand into multiple African markets and build businesses serving millions of customers.

Their greatest contribution, however, extends beyond capital.

They create credibility.

For investors unfamiliar with African markets, graduating from a respected accelerator provides an independent signal that a business has undergone rigorous scrutiny.

Trust becomes transferable.

Africa needs many more institutions that perform this role.

The Real Pitch Is About Risk

One lesson every founder eventually learns is that investors are rarely asking, "How big could this become?"

They are asking something much simpler.

"What could cause me to lose my money?"

The best investment pitches therefore do not merely explain the opportunity.

They systematically remove doubt.

Every customer becomes evidence.

Every partnership reduces execution risk.

Every governance improvement builds confidence.

Every financial control increases trust.

The businesses that communicate risk effectively are often funded ahead of businesses with technically superior products.

Where ONGOLO Fits

This challenge is precisely why ONGOLO exists.

Too often, exceptional African businesses remain invisible to international investors, not because they lack quality, but because they lack access, preparation and trusted intermediaries.

Our ambition is to become one of the institutions that helps close that gap.

Through investment readiness bootcamps, we want to help founders understand how investors actually evaluate businesses—not simply how to build a pitch deck, but how to build a company that sophisticated investors are prepared to back.

Equally important is helping founders access the right capital.
Through our growing network of investment firms in London and Dubai, we are beginning to connect African businesses with international sources of finance. Much of this capital is debt financing for established businesses seeking to expand, but we are also working with investors actively looking to back founder-led companies with equity where the opportunity is compelling.

Capital exists.

Strong businesses exist.

Too often, they simply never find one another.

Our role is to help change that.

A Better Playing Field

The answer is not to make African investors behave more like Silicon Valley.

Nor is it to encourage investors to lower their standards.

The answer is to reduce the information gap between founders and funders.

That requires stronger founders, better governance, trusted intermediaries, respected accelerator programmes, more active local angel investors, deeper regional ecosystems and greater collaboration between African entrepreneurs and international capital.

Most importantly, it requires institutions that can translate local opportunity into global confidence.

The Opportunity Ahead

Ironically, the timing may be perfect.

Following a series of high-profile startup failures around the world, investors are becoming more disciplined. They increasingly want businesses with genuine customers, real revenue, sound governance and sustainable economics.

Those are precisely the qualities many African entrepreneurs have spent years developing because they never had the luxury of easy capital.

The challenge is no longer proving that Africa can build world-class businesses.

The challenge is ensuring that world-class investors know where to find them.

That is the gap ONGOLO intends to help close.

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