Phia Co-Founders Accused of Inflating Revenue via Cookie Stuffing

E-commerce startup Phia is facing allegations of using a deceptive practice known as cookie stuffing to fraudulently inflate affiliate commissions. The company's browser extension automatically injected tracking cookies into the checkout processes of major retailers, including Nike, Gap, and Nordstrom, allowing Phia to claim credit for sales it did not drive, even without user interaction.

Internal Slack communications and source code analysis reveal that co-founders Phoebe Gates and Sophia Kianni were aware of these features since at least December 2025. This contradicts Phia's public claims that the issue was a software bug discovered and fixed within 24 hours in July 2026. Evidence suggests the founders actively pushed for automatic cookie-drops to capture revenue from all gross merchandise value, with some features designed to bypass user attempts to close pop-ups.

Following a Bloomberg report, Phia removed the features on July 7 and suspended monetization efforts. This led to a sharp revenue decline from approximately $80,000 per day to between $10,000 and $28,000. Internal data indicates that cookie stuffing accounted for roughly 51% of the merchandise value Phia claimed in June. In response, the affiliate network Impact.com suspended Phia from its marketplace and began reallocating unpaid commissions. Phia has since started issuing transaction reversals to its brand partners and is hiring a head of compliance.