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Mark Cuban called Breathometer his biggest investment failure on Shark Tank during a July 2022 Full Send podcast appearance. The smartphone breathalyzer startup received $1 million from all five Sharks in 2013, with Cuban investing $500,000 for 15% equity while other sharks jointly contributed $500,000 for another 15%.
However, by August 2021, Shark Tank product’s annual revenue dropped to $1 million. In July 2022, Cuban publicly confirmed losing his million-dollar stake in the business. The products became unavailable by August 2023.
Recalling the investment failure, Cuban said,
“It was a great product. But, the guy – Charles – I’d look at his Instagram and he’d be in Bora Bora...I’d text him, like ‘What the f--- are you doing? You’re supposed to be working’. Next thing you know, all of the money’s gone.That was my biggest beating.”
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Mark Cuban calls Breathometer his worst Shark Tank deal as $500,000 vanishes
Charles Michael Yim presented Breathometer on Shark Tank Season 5 in September 2013. His device connected to smartphones through the headphone jack to measure blood alcohol content.
During his presentation, Yim served champagne to demonstrate the product's functionality in real-time. Lori Greiner tested the device, recording a 0.04 reading. Yim requested $250,000 for 10% equity.
The negotiation intensified as Mark Cuban opened with a $500,000 offer for 20%. When Lori Greiner attempted to partner with Cuban, he declined. Kevin O'Leary proposed $250,000 for 15%.
The dynamic shifted when Yim mentioned his plans for a million-dollar venture capital round within 60 days. Robert, Kevin, and Lori formed a team offering $750,000 for 30%. Daymond John entered with $250,000 for 10% plus unlimited manufacturing support.
The final agreement emerged when Kevin suggested all Sharks participate. Shark Tank permanent investor Cuban committed $500,000 for 15% equity, while the remaining Sharks contributed $500,000 for another 15%. This structure created the show's first-ever five-Shark partnership.
Post Shark Tank journey
In January 2017, the Federal Trade Commission launched a formal complaint against Breathometer. The investigation revealed the company made misleading claims about product accuracy. Their testing data fell short of substantiating advertising claims about measurement precision.
The FTC mandated Breathometer to notify and fully refund every customer who purchased devices between 2013 and 2015. Jessica Rich, director of the FTC's Bureau of Consumer Protection, emphasized the risks of overstating accuracy in devices that influence decisions about driving safety.
The company shifted focus to develop Mint devices for oral health analysis after discontinuing the breathalyzer app which was followed by a drop in revenue and total halt in August 2023, with founder Charles Michael Yim claiming an acquisition.
Mark Cuban shared his concerns on the Full Send podcast about Yim's management approach and frequent luxury trips.
Yim responded to these claims through CNBC, stating Cuban's assessment was inaccurate. He defended his travel schedule, explaining the Necker Island visit resulted in a meeting with Richard Branson. This connection led to Breathometer becoming a finalist in Branson's 2015 Extreme Tech Challenge pitch competition.
Yim acknowledged different factors contributed to the company's challenges. He pointed to insufficient product testing protocols rather than management decisions as the primary issue. In recent statements, Yim mentioned a potential acquisition deal, though no official documentation supports this claim.
The regulatory intervention established that Breathometer's devices consistently provided inaccurate blood alcohol content readings. The company maintained awareness of these accuracy issues while continuing product sales and marketing efforts. This practice eventually triggered the FTC's enforcement action, leading to the company's market exit.
Currently Mark Cuban is serving his last season as a Shark Tank permanent shark in season 16. Viewers can catch new episodes on ABC network.
