Phoebe Gates, daughter of Bill Gates and Melinda French Gates, faces scrutiny over her AI personal shopping assistant startup Phia after a Bloomberg report alleged the company engaged in cookie stuffing, an illegal affiliate fraud practice. The report claims the fraudulent activity accounted for over half of Phia's revenue in June, raising serious questions about the company's business practices and valuation.
Phia, a portmanteau of the founders' names Phoebe and Sophia, was founded in a Stanford dorm room by Gates and her roommate Sophia Kianni, officially launching in April 2025. The fashion shopping app initially raised $8 million in seed funding backed by investors including Kris Jenner, Hailey Bieber, Sheryl Sandberg, and Spanx's Sara Blakely. In January, the company raised over $35 million in Series A funding, bringing its valuation to approximately $185 million.
Cookie stuffing is a practice where tracking codes are nonconsensually implemented onto users' devices, allowing a company to claim credit for affiliate sales and gain commission even when the user did not use the service to shop. The practice violates Google's Chrome Extension policy and can result in up to 20 years of prison time if prosecuted, according to legal experts cited in the report.
The controversy surrounding Phia comes amid revelations about Gates' unconventional education at Stanford University. Before cofounding Phia, Gates attended a secret winter-quarter class titled «So You Think You Can Rule the World?» or simply «Rule» among students, according to The Stanford Daily. The 10-week off-the-record course, which required a referral and wasn't available through official course registration, reportedly taught students how to «hack any kind of power structure or bureaucratic structure and get what they want in a system of people,» a former student told the student newspaper.
The unofficial course, taught by Justin Lewis-Weber, a 2020 Stanford graduate and founder of insurance technology startup Assured, admitted only six women and six men per quarter. It focused on prisoner's dilemmas, multipolar traps, and readings by Peter Thiel and Paul Graham. Scrutiny of the course includes allegations of a «cult of personality,» with Theo Baker, a 2026 Stanford graduate, describing it in his memoir as «a secret society, a Skull and Bones for the aspiring tech elite.»
Baker, who was denied participation in the course, described the interview process with Lewis-Weber as bizarre, believing the professor aimed to confuse and harangue potential students. «Justin was networking with teenagers he expected to be useful in the future,» Baker wrote, adding that the professor «knew that a certain elite cohort of Stanford students wouldn't be able to resist the mystique he cultivated, the notion of this insider class no one would speak about, where only the very best of the best congregated to learn the secrets of the billionaires they aspired to become.»
Gates reportedly turned to the network of students from the course to recruit employees for Phia. She told Stanford's student newspaper last year that the university «completely changed my life path, not because of the classes, but because of the people I met and the connections I made,» adding, «They gave me the confidence to build Phia. I never intended to start a business.»
Phia's founders have described the app as a solution to streamline online shopping. «We wanted to create something that could do all of our shopping for us,» Kianni told Fortune's Term Sheet podcast last year. «Do it instantly and effortlessly, rather than all the manual price comparison and tab-opening we were doing on our computers.» The company has not publicly responded to the cookie stuffing allegations at the time of writing.