Phoebe Gates’ Shopping App Phia Faces Alarming Claims of Deceptive Sales – What’s Really Behind the Controversy?

So, here’s a head-scratcher for you: what happens when an AI-powered shopping app—one built to reinvent how we hunt for deals—gets caught in a swirl of controversy over allegedly claiming sales it didn’t actually drive? Phoebe Gates’ startup, Phia, is right smack in the middle of this storm. After a Bloomberg deep dive exposed claims that Phia might’ve been ‘cookie stuffing’—basically hijacking sales credits—the company finally answered back, saying they’re “reviewing every transaction” and promising to “learn from this.” But with whispers surfacing that the founders knew about this way before they admitted, it’s got the digital marketing world buzzing. How does a fresh-funded star-studded app juggle trust, tech, and transparency when the stakes—and funds—are sky-high? Let’s dig into the saga behind Phia and what it means for the future of affiliate marketing chaos. LEARN MORE.

NEED TO KNOW

• Phoebe Gates’ shopping app Phia has responded after being accused of knowingly claiming sales that weren’t theirs

• The statement comes after bombshell investigations by Bloomberg

• The company said it is “reviewing every transaction” and “will learn from this”

Phoebe Gates’ shopping app Phia has responded to accusations that it knowingly claimed sales that weren’t theirs.

Founded by Gates and Sophia Kianni, Phia is an AI-powered price comparison tool that aims to “reinvent shopping” and earns commissions through affiliate networks. The app, which has over 9,600 retail brand partners, helps customers calculate resale value, find better-priced alternatives and track price decreases in real time.

In July, Bloomberg reported that Phia had taken credit for sales it didn’t help drive. The company was accused of “cookie stuffing,” an affiliate marketing move that tracks referrals fraudulently. An investigation conducted by Bloomberg, Capital One Shopping and researcher and consultant Ben Edelman alleged that no matter how a user came to Phia, the tool would override any referral codes from other affiliates during the checkout process, instead using its own. Bloomberg went on to report that after contacting Phia about the issue, further testing of the site found that misattribution of sales had ceased.

When reached by Bloomberg at the time, the company reportedly said it was “made aware” of the situation within the “last 24 hours.”

However, in a report published by Bloomberg on Aug. 11, the outlet alleged that the company and its founders reportedly knew this was happening as far back as December, citing “people and messages posted on the company’s internal Slack channels that were shared” with the outlet.

A rep for Gates referred PEOPLE’s questions to Phia. A spokesperson for the company said in a statement, “Any features causing misattributions were immediately removed over a month ago on July 7. 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,” the spokesperson continued. “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.”

The statement did not address Bloomberg’s latest accusations. A statement shared with Bloomberg also did not address this.

On May 29, Phia announced it had received $35.5 million in new seed funding led by Notable Capital, Khosla Ventures and Kleiner Perkins.

Phia also attracted several new celebrity donors, including Khloé Kardashian, Alix Earle, Olivia Culpo, Paris Hilton, Mindy Kaling, Jessica Alba, Sydney Sweeney and Priyanka Chopra Jonas.

The company’s total funding was brought to $43.5 million thanks to the $8 million raised during its previous seed round led by Kleiner Perkins, which also included donations from Hailey Bieber and Kris Jenner.

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“My mom has always had an eye for what’s next, so when Kris Jenner invests in something, I pay attention,” Kardashian, 41, previously said in a statement. “I’m so excited to join her as an investor.”

Phoebe, the youngest daughter of Bill Gates and Melinda French Gates, has known Kianni since their time at Stanford University, where they first got to know each other as roommates.

“AI is reshaping nearly every industry, but shopping is stuck in the past,” Phoebe, 23, previously told PEOPLE. “Consumers still waste hours comparing prices and hunting for deals, only to still end up overpaying.”

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