Phoebe Gates's Startup Phia Knowingly Ran Cookie-Stuffing Scheme for Months, Internal Slack Messages Show

Phia, the e-commerce startup co-founded by Phoebe Gates (daughter of Bill Gates) and Sophia Kianni, knowingly deployed deceptive cookie-stuffing tactics for at least seven months — directly contradicting the company's public claim that it only discovered the problem within 24 hours of being contacted by a reporter in July 2025. Internal Slack messages and source code reviews tell a starkly different story.

Cookie stuffing, broadly prohibited across the affiliate marketing industry, involves automatically planting a tracking cookie on a shopper's browser without any intentional interaction — allowing a publisher like Phia to claim credit (and collect commissions) for sales it didn't actually drive. Legitimate affiliate marketing requires a user to click a referral link or use a coupon before a cookie can be dropped. Phia's extension instead fired cookies silently in the background, overriding cookies placed by legitimate referrers, on the checkout pages of Nike, Gap, Nordstrom, and others.

Phoebe Gates was personally involved as early as December 18, according to internal Slack messages. In one exchange, she asked developers to confirm that Phia's cookie was being dropped automatically whenever its coupon pop-up appeared — even if the shopper never clicked on a coupon. "worried this is an issue across the board," she wrote. "can u confirm auto pop for cookie drop is live on ALL sites w a coupon to confirm we are monetizing on all gmv." When told the pop-up had a bug but cookies were still auto-dropping, she replied that Phia should "capture every transaction if the cookie drop was working." Co-founder Kianni separately proposed dropping cookies when users tried to dismiss pop-ups, was warned it violated Google Chrome Extension policy, and suggested the company could claim users were "trying to open" the pop-up if anyone complained.

The scale of the fraud is significant. An internal Slack message from a Phia data scientist on July 7 estimated that cookie stuffing accounted for roughly 51% of the gross merchandise value Phia claimed credit for in June alone. After Phia disabled the features on July 7, average daily revenue dropped from approximately $80,000 to between $10,000 and $28,000 — a collapse of up to 87%. Phia disputes the data scientist's methodology and says some of the revenue drop was due to broader monetization shutdowns, not just cookie stuffing. Advertising consultant Ben Edelman, who has spent over two decades investigating deceptive marketing, independently reviewed the source code and corroborated the findings, describing it as a deliberate, multi-part scheme to inflate revenue.

Phia raised $35 million in venture funding in January and has begun issuing commission refunds to retailers. Affiliate network Impact.com suspended Phia from its marketplace and is reallocating commissions attributed to the startup since June 20. The company has promised to hire a head of compliance, conduct a full transaction review, and issue reversals to brand partners. Given that the scheme ran back to at least October or December — well before the June 20 cutoff date for refunds — Phia may face significantly larger repayment obligations than currently acknowledged.