Phia Founders Knew About Attribution Fraud Months Before Denying It

Quick Facts

Internal Slack messages show Phia co-founders knew about cookie stuffing as early as December 2025, 40 days before announcing a $35.5 million Series A round.
A Phia data scientist estimated the practice accounted for roughly 51% of gross merchandise value the company claimed credit for in June 2026.
Affiliate platform Impact.com suspended Phia on July 10, 2026, after a Bloomberg investigation found the extension claimed commissions on sales it did not drive.

Phia co-founders Phoebe Gates and Sophia Kianni knew their shopping app was taking credit for sales it did not drive for at least seven months before the company publicly denied any knowledge of the practice, according to internal Slack messages reviewed by Bloomberg News.

The messages contradict a statement Phia issued in July, claiming it learned of the misattribution problem within the previous 24 hours. Gates was asking employees in December to confirm the app was automatically dropping affiliate cookies across retailers, writing that it should “capture every transaction” if the feature was working.

That December exchange came 40 days before Phia announced a $35.5 million Series A round and touted elevenfold revenue growth. The round valued the company at roughly $185 million and drew celebrity investors including Sydney Sweeney, Paris Hilton, and Khloé Kardashian, alongside venture firms Kleiner Perkins and Khosla Ventures.

How the Scheme Worked

Phia’s browser extension would open a background tab during checkout and inject its own affiliate tracking codes, overriding codes from publishers who had actually brought the shopper to the site. The practice is known as cookie stuffing or attribution fraud.

Independent researcher Ben Edelman identified the behavior in Phia’s own code as a named feature flag called enable_coupon_auto_drop. An internal dashboard screenshot showed the feature could be toggled on or off remotely. Phia initially called it a bug. Bloomberg’s reporting established it was a deliberate build.

Testing by Bloomberg, Capital One Shopping, and Edelman found the extension could claim commissions even when users arrived at a retailer independently or through a competing affiliate program such as Wirecutter.

The Revenue Numbers

The financial stakes are significant. A Phia data scientist wrote in a July 7 Slack message that cookie stuffing accounted for roughly 51% of the gross merchandise value the company claimed credit for in June. When the features were disabled in early July, average daily revenue dropped from about $80,000 to between $10,000 and $28,000.

Phia disputed the 51% figure, calling it a preliminary analysis with flawed methodology. The company also said the revenue drop reflected a voluntary shutdown of most monetization, not just the removal of the disputed features.

Platform Action and Industry Fallout

Impact.com suspended Phia from its affiliate platform on July 10, citing behavior inconsistent with its policies. Phia confirmed it is working with Impact.com to reverse affected transactions and refund impacted parties.

The company said it removed the features responsible for misattributions on July 7. It also said it was reviewing transactions, hiring a head of compliance, and would use the episode to improve its practices.

Phia launched as a free browser tool comparing prices across more than 220,000 sites and auto-applying discount codes. The company said in June it had reached 1.5 million users and nearly 10,000 retail brand partnerships. It was named one of TIME’s Best Inventions of 2025.

For brand partners and affiliate publishers, the case is a direct example of how commission fraud can redirect earned revenue at scale. Retailers running affiliate programs should audit their attribution data for unexpected referral spikes from browser extensions, particularly during checkout events.