Credit: Fortune
Highlights
- The Breathometer appeared in one of the initial seasons of Shark Tank.
- The entrepreneur managed to secure a deal from all five panelists.
- Find out the different events that led this million-dollar-earning company into oblivion.
For viewers, Shark Tank is a visual spectacle through which they get to watch their favorite investors make hefty investments in budding ventures. Stories of entrepreneurs also captivate them to the extent that they vouch for them to secure the best deals.
But the happy smiles we get to see after a deal is locked are often short-lived. There have been several instances in different Shark Tank seasons where the investment stories turned out to be horror stories for the judges. Here we will talk about one such deal, which emerged as the biggest ‘scam’ in the history of the show:
The Breathometer Pitch
The Breathometer was a breathalyzer connected to a smartphone. Claiming it to be the first-ever tech-supported breathalyzer, entrepreneur Charles Michael Yim sought $250K for 10% equity.
Bearing a work history in Silicon Valley, Charles created the product with the motivation of saving lives through its exceptional alcohol detection abilities. Describing its functionalities, he stated it to be a modern and better version of the age-old breathalyzers.
Unlike the bulky old ones, these were portable and could be easily connected to any smartphone.
The Sharks seemed quite impressed with the short yet impactful presentation. Lori Greiner then volunteered and went to Charles to check how the device worked.
The Negotiations And Final Deal
Each of the panelists was convinced that the product could become a success in the coming years and proposed their offers one after the other. Mark Cuban offered $500K for 20% equity. Lori was interested in joining him, but Mark instantly declined. Kevin O’Leary was the next to offer $250K for 15% equity.
Charles interrupted and said that he was looking forward to conducting a million-dollar venture capital round in the next two months. Hearing this, Kevin, Lori, and Robert Herjavec joined hands to offer $750K at 30% equity. Daymond John followed them and proposed $250K for 10% equity alongside unlimited manufacturing.
Seeing it get competitive, Kevin asked all the investors to come together and offer $1 million. Charles grabbed this as a golden chance and offered to give Mark the ‘Lion’s Share.’ He requested $300K from just Mark and the remaining $700K from the other four.
Eventually, all the Sharks joined hands to offer the final deal at $1 million for 30% equity. Mark alone agreed to invest $500K for 15% and the remaining Sharks offered the remaining $500 for 15%. Charles accepted the deal.
Why is The Breathometer A Scam?
The Breathometer performed decently for the first few years. After its appearance on Shark Tank in 2013, the company received bulk orders, which helped it earn $1 million in sales within months. It even featured on multiple update segments of the show, where Charles presented The Breeze, The Breathometer’s Bluetooth version.
But trouble started brewing after this. In 2017, it was revealed that the device purposely showed a lower BAC level than the actual one. The company was well aware of the same. Despite this, it went ahead with selling the products and even marketing them.
Consequently, the Federal Trade Commission called it out and asked for refunds for all who bought The Breathometer from 2013 to 2015. Soon after this, the Breathalyzer app, which was used to connect the product to smartphones, was found unavailable.
But the real shocker for Shark Tank followers came in 2022 when Mark Cuban, who held the maximum equity percentage in the company revealed that he had lost millions of dollars in Charles’ business.
It all happened during one of Mark’s podcast interviews in 2022. He was asked about his ‘biggest loss’ on Shark Tank. Without thinking much, he revealed it to be ‘The Breathometer.’
Expanding on the details, he said that he was supremely impressed by Charles’ concept, which is why he agreed to become the biggest investor in the deal. But his excitement soon vanished when he found that instead of working for the business, the entrepreneur was busy traveling.
He would often post pictures of himself in the most exotic locations, including Las Vegas, Nectar Island, and Bora Bora. But when confronted about it, Charles used to repeat the excuse that it was important for ‘networking.’ Soon, all the invested amount was gone.
Is The Breathometer Still In Existence?
The answer is no. The latest update is that the products have been unavailable ever since August 2023. Additionally, Charles claimed that the business was acquired. But with no solid evidence, its status remains to be a suspense.
To Conclude
The Breathometer is regarded as the biggest scam in Shark Tank’s long history for multiple reasons. First, the entrepreneur managed to convince all five judges that his product would revolutionize the industry and save lives, which led to his securement of a million-dollar deal.
Secondly, he knew his device was faulty and showed wrong readings of the alcohol intake. Thirdly, he took all of the invested amount of all the Sharks and spent it vacationing in different places.
References
1. Mark Cuban says this was his worst ‘Shark Tank’ investment ever: ‘Next thing you know, all of the money’s gone’, CNBC, Tom Huddleston Jr.
Entrepreneur, auteur, raconteur. Rob Merlino is a blogger and writer who enjoys the Shark Tank TV show and Hot Dogs. A father of five who freelances in a variety of publications, Rob has a stable of websites including Shark Tank Blog, Hot Dog Stories, Rob Merlino.com and more.
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