Bill Gates' youngest daughter, Phoebe Gates, has come under fire after an explosive report claimed that she and her co-founder were allegedly engaging in a fraudulent practice to boost revenue for their AI-powered shopping program, Phia.
The program, which includes an app and a browser extension and is partnered with over 9,600 retail brands, aims to "reinvent shopping" by comparing real-time prices for clothing and other items across new and secondhand websites, and providing discount codes.
The shopping app scandal
© Anadolu Agency via Getty ImagesPhoebe co-founded the app in April 2025 with her friend Sophia Kianni, and the pair have come under renewed scrutiny following a report from Bloomberg that alleged they were aware of an issue in their system since December 2025.
The app has reportedly been "cookie stuffing", which is a marketing tactic that involves small data files being stored in a user's web browser. The tactic means that Phia would generate a commission from the retailer, even if the user didn't buy the product or if Phia didn't help drive the sale.
© Getty ImagesCookie stuffing can lead to lost revenue for retailers, and is a form of online fraud that can come with severe penalties.
After Bloomberg's original piece alleging that Phia was employing the cookie stuffing tactic, a representative from the company shared that the team was "made aware" of the issue within the "last 24 hours".
A new development
However, the publication's newest report alleged that the team knew about it as far back as December 18, per internal Slack messages shared with Bloomberg.
"Any features causing misattributions were immediately removed over a month ago on July 7," a representative said in a statement following the report.
© Getty Images for Business of Fas"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 statement 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."
Revenue decline
© Getty Images for GQSeveral high-profile celebrities donated to or invested in Phoebe and Sophia's app in 2025, including Khloé Kardashian, Kris Jenner, Alix Earle, Olivia Culpo, Mindy Kaling, Jessica Alba, Sydney Sweeney, Hailey Bieber and Priyanka Chopra. Phia received more than $35 million in seed funding in May 2026.
Since the cookie stuffing issue has been reversed, the company has seen a massive drop in revenue, with Bloomberg reporting that the daily average of $80,000 plummeted to between $10,000 and $28,000. The Phia team claimed that this decline was due to their decision to cease most of its monetization efforts.
© Paul MorigiPhoebe, 23, previously spoke to People about the power of AI in the shopping and retail industry. "AI is reshaping nearly every industry, but shopping is stuck in the past," she said. "Consumers still waste hours comparing prices and hunting for deals, only to still end up overpaying."
Phoebe is the youngest daughter of Microsoft founder and billionaire Bill Gates and his ex-wife, Melinda French Gates. They also share kids Jennifer and Rory. Phoebe met her co-founder, Sophia, when they studied and lived together at Stanford University.
