Wisdom Earned the Hard Way: My 45-Year Martial Arts Business “Screw-Up” Map

In the martial arts community, we have so much respect for the super-successful schools and instructors. Personally? I prefer to learn from the ones who have screwed up along the way. Wisdom is earned from facing challenges and somehow getting to the other side.

In 45 years of teaching, I’ve had 7 rental locations. I’ve taught long-running classes in churches, schools, parks, recreation centers, YMCAs, and fitness gyms. I am not the school owner who inherited a goldmine, or who got lucky opening the first facility in a booming, high-income zip code.

Here are my major screw-ups. Please, learn from them. Don’t make the same ones.

1. Hiring Too Early

You can keep doing it all yourself. No, you don’t want to, and no, it isn’t easy.

But hiring someone else means paying someone else. If you are trying to increase profits, you just messed that up. If your income fluctuates, you now have to let someone go—someone who you may feel strongly about keeping on staff.

There will come a time when you will absolutely know, without a doubt, that you cannot continue to the next level without hiring help. Wait until then.

2. Hiring the Wrong People

We often look within our own student base for staff. Part-time young instructors are great for assistants, but ask yourself: could you instead build a leadership team that you teach how to help? If they come in as volunteers for one class per week, you aren’t paying them—they are paying you. Heck, they pay you extra if you charge for your leadership program.

People sign up for their own reasons, but they stay for the connections they make with you and your staff. The team you do hire must be the absolute best you can find. They must have an over-the-top personality, a strong appreciation for people, and a powerful ability to make others admire and like them.

Maybe you can find this person from within, but you might do better to hire from the outside. Honestly, it’s a lot easier to fire outside people if the need arises.

3. Not Training Staff Frequently and Repeatedly

You need weekly staff meetings, daily briefings, and continuing education at industry events.

If you currently have no staff, sit down and take yourself through an agenda anyway. You listened to your instructor for years and did what they told you to do. Now, do it to yourself.

Never stop learning. You should know how to do social media marketing yourself, even if you hire someone else to handle it. Otherwise, you can’t even audit what they are doing. You should know the latest and greatest sales tactics, banking strategies, instructional methods, and financial tactics.

4. Failing to Know Your Numbers

I am incredibly guilty of this. We get so busy teaching great classes, working on enrollments, upgrades, tournaments, demonstrations, school visits, marketing, and private lessons that we don’t even know how we are actually doing.

So many school owners are living in total delusion because of this.

I had an owner tell me recently that they don’t lose many students and have great retention. I asked how many students he had. He said 200.

“Great. How many did you have a year ago?”

He said 180.

“How many did you enroll this year?”

He said about 100 in the past 12 months.

I looked at him and said, “If you enrolled 100 and didn’t lose anyone, you would have 280 students today. You went from 180 to 200. That means you lost 80 students this year. Your retention is not as good as you think it is.”

Because we see happy, smiling faces on the mat every day, it is easy to overlook the absentees. Retention is only one metric we should know and share with our team.

The 6 Metrics You Must Look At Weekly

You don’t need a math degree for this; you can easily use AI to help you figure it out. Here is what you need to track:

Churn Rate (Retention): We want to see this at less than 5% monthly. My school shoots for 3%.
MIA (Attendance Flags): We call all students who miss their “A” day (either Monday or Tuesday) to get them into an extra class that week. Ignore them, and they will feel unimportant and quit. Someone who misses a whole week is critical. Time for a call and a private lesson.
Trial-to-Member Conversion: First, know your actual monthly trial volume (we are historically terrible at tracking this). Second, aim to convert 30% to 50% of them into students. We used to shoot for 80%, but it is a different world today.
Average Revenue Per Member (ARPM): Take your monthly gross income and divide it by your active student count. This is driven by down payments, tuition, special events, graduation fees, private lessons, and equipment packages. We shoot for $175 to $210+.
Facility Utilization: Quarterly, look at your student-per-class census and adjust the schedule. If you promote a ton of students to intermediate but only have two classes a week for them, it’s time to shift resources and reduce beginner slots. We just added more weapons classes because our upgrade programs exploded, and we added a third preschool class so parents have a guaranteed makeup option. Without looking at the numbers, we wouldn’t have noticed the bottleneck.
P&L (Profit and Loss): Track all expenditures and income sources daily so you can pivot immediately if things change. You won’t notice the bleed if you don’t track it.

My Biggest Mistakes

The Lost Leader

I had a phenomenal Program Manager who wanted to be more involved in the operations of the business. He had the experience to back it up. But I was afraid of losing agency, panicked, and said, “No, thank you.”

He respectfully left, moved to another town, and opened his first school. Today, he owns 5 schools. He did it right, and he has done incredibly well. I am super proud of him, and we are still great friends.

The Lesson: When you have a great employee, do what it takes to keep them. Read the EOS (Entrepreneurial Operating System) books. Make them a real part of your business growth.

The 12-Year Mistake

To replace him, I hired an adult student. She was approachable, friendly, and kept her private life private, which felt great because she brought zero drama to the workplace. It was a total shock to us when she announced she was getting a divorce.

To make a long story short: she was a student for 16 years and a barely acceptable employee for 12. In her final year with us, she started dating one of our school dads. He held a massive grudge against me and orchestrated a series of events that ultimately ended with me suing both of them. We settled, but it was ugly, incredibly expensive legally, and deeply stressful.

The Lesson: Don’t keep inadequate employees. If they cannot be trained to perform to your standards, replace them quickly. Pull off the bandage.

The Blindspot That Cost Everything

This event rolled right into the next nightmare. The boyfriend of my ex-employee made friends with another dad in the school—a father of a promiscuous and experienced teenage girl.

The girl targeted an adult instructor who happened to be my son. Because he was raised entirely within the martial arts school, he was an amazing martial artist but incredibly sheltered, unworldly, and overly trusting. Her mother actively encouraged the relationship, literally arranging private time in her home for them to be together.

When the girl offered to please him orally, he accepted. He immediately regretted it, stated he didn’t want to do it again, and said they should just be friends. She agreed. Months later, her dad filed criminal charges.

Today, my son is in prison. When he is released, he will be labeled a sex offender for the rest of his life. The girl was dating another adult just a few months later.

While this did not happen at my school, and he wasn’t technically an employee at the time, the local media had a field day with it. To this day—5 years later—the school board has blacklisted our business from any community partnerships.

The Lesson: Do not shelter your kids. Do not trust overtly toxic or compromised clients of any age; remove them from your school. If you get even a whiff of romantic interest between an instructor and a student (or vice versa), terminate the relationship immediately. Fire the staff and remove the student. Protect the house.

The Crisis Avalanche

Recently, my 88-year-old parents have become incredibly difficult to care for. My mother is frail with severe heart and lung issues, and my dad has dementia and forgets his medication. In the past 6 months, I’ve had them in and out of the hospital three times each.

To keep them afloat, I’ve been paying their rent and groceries for several years. This severely cut into the capital I needed for my business and took away the time I required to adequately manage it. My commercial rent got behind, then further behind. Once you fall behind, it is almost impossible to catch up.

My landlord evicted us. In a forty-eight-hour whirlwind, we moved into a brand-new facility. It is smaller and cheaper—which is ultimately a blessing—but we are currently trying to teach classes here while simultaneously laying down flooring, moving mirrors, doing minor demolition, and alerting our students to where we are. All of this while navigating my parents’ hospital transitions.

Luckily, my team put in some serious work to pull in big enrollments and upgrades to bridge the financial gap.

The Lesson: Rent comes first. Lay off employees if you absolutely must, but never fall behind on your facility. Furthermore, delegate your bills and administrative tasks when life hits you, so you have the freedom to take care of your family.

Never, Ever Quit

My philosophy is that the default setting for human beings is to screw up. In a sense, it’s a beautiful thing. The person who gets everything right from day one doesn’t actually grow, and they never achieve true self-actualization.

Look at your own students. The ones who walk through your doors as perfect, natural athletes gain far less from martial arts than the ones who have to fight through physical and mental challenges just to make it to the next belt.

As business owners, we have to embrace our mistakes, embrace the absolute repetition of the boring administrative stuff, and never, ever quit.

If you are a school owner and you are currently going through it, don’t hesitate to reach out. I’ve seen the highest highs and the absolute lowest lows—and I’m still here on the mat.