Bill Gates' daughter's startup pulls feature after reports alleged misattribution of referral credit

A shopping tool designed to help people score fashion deals is facing scrutiny after investigations found it was taking credit for sales it may not have actually generated.

Following those investigations, Phia — the startup co-founded by Phoebe Gates, Bill Gates' daughter — said it had taken down functions that were causing a misattribution of referral credits through cookie placements.

Here's what to know

Affiliate marketing is meant to reward the source that genuinely leads a shopper to make a purchase. When a company's service adds its own cookies in a way that does not require the user to have used its service to make an eventual purchasing decision, it can divert that referral money away from publishers, creators, or comparison sites that actually helped the customer find the item.

According to Bloomberg and outside researchers, Phia's browser extension was automatically finding and showing a coupon for its users' shopping practices and placing a cookie in that process, a setup that led to the company earning affiliate commissions on orders it did not necessarily refer to the retailer involved.

A more recent Bloomberg report said those attributed sales made up about 51% of Phia's credited sales in June 2026, according to a Phia Slack message its reporters reviewed, though a Phia representative noted in an email to The Cool Down that "the revenue decline reflects Phia's decision to disable most of its monetization on July 7 while it reviewed the matter."

Capital One Shopping called the practice "cookie stuffing" in an email to retailers cited in Bloomberg's reporting, a label that a Phia representative disputed in an email to The Cool Down, noting that users had to download the Phia app and consent to popups that included a cookie disclosure.

"Any features causing misattributions were immediately removed over a month ago on July 7," Phia said in a statement obtained by The Cool Down. "We are reviewing every transaction, we are fully committed to and have already begun issuing all transaction reversals to brand partners as a result of any misattribution, and we are hiring a head of compliance to make sure something like this never happens again. We are now continuing to connect our users with items and offers from thousands of brand partners. We will learn from this and want to ensure our users have the best possible shopping experience, with features like our new digital closet and more to come."

Experts who study the law said cookie stuffing can fall under federal wire fraud rules, which carry potential prison terms of up to 20 years. Phoebe Gates has not been charged with any crime, and the Bloomberg report does not allege that she personally directed the company to enact the practice in question.

That second Bloomberg report claimed that internal messages suggested company leaders had been aware of the behavior for months, despite the startup's early public characterization of it as a problem the company had only recently discovered. A Phia representative told The Cool Down that "the behavior that they were aware of was to show coupons – not cookie stuffing."

More background

The case points to a broader issue: The digital shopping tools people use every day can be built in ways that quietly benefit the company behind them more than the shopper.

If brands are paying commissions on sales they did not actually help generate, those costs do not simply disappear. They can affect marketing budgets, squeeze smaller retail partners, and undermine trust across the online shopping ecosystem. Legitimate referral partners can also lose income when another company inserts itself into the transaction at the last second.

That kind of behind-the-scenes manipulation can make it harder to know whether a browser extension or shopping helper is genuinely working in the shopper's interest. A product marketed as a money-saving tool can still rely on business practices that shift value away from others in the marketplace.

The story is not just about one startup's misstep, but also about the risks consumers take when they install tools that can monitor browsing activity and intervene in purchases without clearly showing what is happening.

What's being done?

In response, Phia says it has stripped out the challenged features, is reversing transactions for affected brand partners, and intends to bring on a head of compliance, as detailed by People.

When a company's growth depends on invisible tactics rather than transparent value, the fallout rarely stays confined to the business itself. It can ripple outward to shoppers, retailers, and honest partners throughout the online economy.

Editor's note: This article has been updated to clarify that Phia issued the statement about disabling functions causing misattribution of referrals rather than Gates herself. It was also updated to include information from a Phia representative's statement about how the company does not agree with the characterization of "cookie stuffing" as well as some other details from Bloomberg's reporting. Those details from the reporting were maintained in the article while adding Phia's comment.

Get TCD's free newsletters for easy tips, smart advice, and a chance to earn $5,000 toward home upgrades. To see more stories like this one, change your Google preferences here.