Bill Gates' daughter' startup Phia investigated for claiming commissions from online sales it didn't generate: Report
AI Summary
Phia, a shopping startup co-founded by Phoebe Gates, is facing scrutiny after allegations surfaced that its browser extension engaged in 'cookie stuffing' to improperly claim affiliate commissions. The company has admitted to a coding issue and has addressed it, but the incident has raised concerns about affiliate marketing practices. Phia has secured $43.5 million in funding and boasts over 1.2 million downloads, but this controversy may impact investor confidence moving forward.
Phia, the shopping startup co-founded by Phoebe Gates, daughter of Microsoft co-founder Bill Gates, has come under scrutiny after a Bloomberg investigation alleged that its browser extension was improperly claiming affiliate commissions through a practice known as "cookie stuffing."
The company has acknowledged a coding issue and says it has already fixed the problem. However, the allegations have reignited debate over affiliate marketing practices and how browser extensions earn commissions from online purchases.
Launched in 2025 by Phoebe Gates and entrepreneur Sophia Kianni, Phia describes itself as a personal shopping assistant.
The browser extension helps shoppers compare prices across retailers, discover second-hand fashion items and automatically search for discount codes while users browse online stores.
The startup has raised $43.5 million from investors including Notable Capital, Kleiner Perkins and Khosla Ventures, along with celebrity investors such as Sydney Sweeney, Khloe Kardashian, Hailey Bieber and former Meta executive Sheryl Sandberg.
According to Appfigures estimates cited by Bloomberg, the app has been downloaded more than 1.2 million times over the past year.
According to Bloomberg, Phia's browser extension was automatically inserting its own affiliate tracking code during the checkout process—even when users had not interacted with the extension.
Bloomberg tested the extension on more than 50 retail websites and found that it silently opened a background browser tab before completing purchases.
That background tab loaded Phia's affiliate link, replacing referral codes from other publishers and enabling Phia to receive commissions for purchases it may not have influenced.
Independent affiliate marketing researcher Ben Edelman and Capital One Shopping reportedly reached similar conclusions after conducting separate tests.
Affiliate marketing is a common online advertising model in which publishers, influencers, websites or browser extensions receive a commission for directing shoppers to retailers.
If a shopper clicks an affiliate link and completes a purchase, the retailer pays that affiliate a commission.
The system is designed to reward businesses that genuinely influence purchasing decisions.
Cookie stuffing refers to the practice of placing an affiliate tracking cookie on a user's browser without their knowledge or without a legitimate click.
If the shopper later completes a purchase, the party that inserted the cookie can receive credit—and earn a commission—even though it did not actually drive the sale.
Original Article
Published on Livemint