Phoebe Gates’ Startup Faces “Cookie Stuffing” Allegations
Phoebe Gates, the 23-year-old daughter of Bill Gates, has come under fire for alleged “cookie stuffing” at her multibillion-dollar startup, Fire. This could lead to a serious legal situation, with the potential for up to 20 years in federal prison.
Gates co-founded Fia, a digital shopping assistant, alongside Stanford graduate Sophia Chianni. Recently, the app received criticism for supposedly inflating sales figures for its retail partners by dropping more web cookies than necessary. When the controversy emerged in July, the company claimed it was unaware of the issue until just a day prior. Yet, sources suggest that the founders might have been aware of the practice for at least seven months.
Ariel Givner, an attorney, highlighted the potential legal ramifications, noting that cookie stuffing could be considered a form of federal wire fraud, drawing significant penalties.
A Fire spokesperson stated that the functionality causing misattributions was removed on July 7, and the company is actively reviewing all transactions to address any misattributions while committing to improve compliance measures to prevent future incidents.
Despite the backlash, the startup’s operations continue, aiming to connect users with offers from various brands. At one point, Fia had successfully raised an impressive $30 million in funding from well-known personalities like Hailey Bieber and Kris Jenner.
The app operates as a browser extension, simplifying how users find discount codes. However, it also tracks user activity through cookies, which are intended to credit the companies for sales they didn’t directly drive.
Reports indicate that both Gates and Chianni were aware of how the cookie dropping system functioned, even when users weren’t intentionally interacting with the Fia extension. Allegations have surfaced that fraudulent cookies were used dating back to December, impacting several major retailers and making up a notable portion of Fia’s revenue.
Since disabling this feature in July, Fia has seen a drastic drop in revenue—averaging between $10,000 and $28,000 daily, down from around $80,000. Interestingly, prior to the disruption, cookie dropping accounted for over half of Fia’s claimed sales credits.
While the company pinpoints July’s financial decline on disabling monetization efforts alongside the cookie stuffing issue, they argue the reported data may be exaggerated.
The feature that was originally labeled a bug is, in reality, a controllable function allowing the automatic dropping of coupons, which Gates was concerned about when it seemed the company wasn’t making enough from Etsy sales.
Gates even reached out to developers requesting that cookies be dropped with every pop-up—regardless of whether a coupon was clicked—ensuring they earned commission on total purchases.
Additionally, a proposal surfaced to enable a cookie drop whenever someone attempted to close the Fia pop-up, raising eyebrows about compliance with Google Chrome’s restrictions on such practices.
As the situation develops, one of Fia’s partners has already halted its network, redeploying the commissions that were set aside for Gates’ company. Although it seems they may reconsider their decision, the policy’s length raises further questions about the extent of potential refunds needed.
