Where Martial Arts School Business Systems Came From: The Dance-Studio Lineage

The enrollment conference, the introductory lesson, the prepaid programme and the weekly numbers meeting did not start in a dojo. They came to martial arts from the franchised ballroom-dance studios of the mid-twentieth century, through a small circle of Texas black belts, Jhoon Rhee’s Washington schools, the Kenpo organisations of California, the Chuck Norris studios and, finally, Educational Funding Company. This is the lineage, with dates, and with a clear line between what the record shows and what rests on one participant’s memory.

By Grand Master Stephen Oliver, 10th Degree Black Belt

Where did martial arts school business systems come from?

Most of the operating model a professional martial arts school runs on today was borrowed, not invented. The introductory lesson, the scripted enrollment conference, the tuition agreement paid over time, the instructor who is also expected to sell, the children’s programme, the multi-location chain run on weekly statistics: the franchised ballroom-dance studios had all of it working by the 1950s.

What martial arts added was a product the public had barely heard of. When the first commercial karate schools opened in the United States around 1960, their owners were, in the words of one of them, running a labour of love where “it was a successful month when I paid the rent.” Within a decade a handful of those owners had adopted the dance-studio playbook, and their schools changed from clubs into businesses.

The route from the ballroom to the dojo ran through a surprisingly small number of people.

What did the dance studios already know?

Arthur Murray had begun building a chain of studios by about 1920, and the company describes itself as one of the oldest franchised businesses in the United States. Fred Astaire Dance Studios was co-founded in 1947 by the dancer with Charles and Chester Casanave and was franchised from 1950. A third, smaller network, the Linkletter–Totten Dance Studios, used the broadcaster Art Linkletter’s name.

These businesses sold something intangible and slow to master, to adults and children who could quit at any time. Their answer was a system. Leads came in from advertising and were booked into a free or low-cost first lesson. The first lesson was followed by a structured conversation in which the student was offered a course of lessons, often prepaid or financed. Instructors were trained in both teaching and selling. Owners watched a short list of numbers every week. Children’s divisions fed long-term enrollment, and some studios even collected children from school and drove them to class.

Anyone who has worked in a modern martial arts school will recognise every element.

How did Pat Burleson bring the system into karate?

J. Pat Burleson (1936–2021) returned to Fort Worth, Texas, in 1959 after naval service in Japan, where he had begun training. He taught his younger brother and friends in the family garage and, in 1960, rented his first building for $45 a month. Through Allen Steen of Dallas he met Jhoon Rhee, then a student at Southwest Texas State College, and began training under him. Steen became the first of Rhee’s American students to reach black belt, in 1962; Burleson followed within months. (Published accounts differ on the exact year and order; see the sources box below.) In 1964 Burleson won the first National Karate Championships, which Rhee hosted in Washington, D.C.

The business turn came in the mid-1960s. In an interview with this journal in 2009, Burleson described how local businessmen who held the Fred Astaire Dance System licence for his part of Texas came to his school for private lessons, went into business with him and taught him their sales system. “The number of new students and dollars in the bank just exploded,” he said. He estimated his revenue at about $5,000 a month with a couple of hundred active students. The full interview is republished in our archive: The Father of the Modern Martial Arts School Business Model.

His own warning about the system has worn well. He compared it to a finely tuned sports car and admitted that he had run his schools mostly on the front end, generating leads and new students, while neglecting the back end that keeps students enrolled.

Stephen Oliver’s recollection: as I understood it from the people involved, the dance-studio operators who worked with Burleson also taught the basics of their system to other Texas karate pioneers of that circle, among them George Minshew and Jim Harrison. I have not been able to confirm that from a published source, and readers should treat it as oral history.

How did Jhoon Rhee adopt the dance-studio methods?

Jhoon Rhee (1932–2018) came to the United States in 1956 and studied at Southwest Texas State College and the University of Texas. In 1962 he moved east and opened his first American studio in Washington, D.C., in 1962, eventually building a network of studios across the Washington area.

Burleson said in 2009 that he taught Rhee the system he had learned, and that he had been worried about how it would be received. Having lived in Asia, he expected a traditional instructor to be uncomfortable with the commercial side of martial arts. Stephen Oliver’s recollection, from conversations over many years: Burleson’s nervousness proved unfounded. Rhee embraced the methods completely and absorbed everything he could, and he went on to hire people who could run them better than he could.

The most important of those hires came straight from the dance industry.

Where do Ed Parker and the Kenpo schools fit?

Ed Parker (1931–1990) opened what is generally described as the first karate school in the western United States in Provo, Utah, in 1954, and was teaching in Pasadena, California, by 1956. In 1962 he handed control of the Kenpo Karate Association of America to the Tracy brothers and formed the International Kenpo Karate Association. The Tracys went on to open schools across California and beyond under what became Tracy’s International Studios of Self-Defense.

Burleson said he showed his system to Parker in Los Angeles, and that Parker “understood the possibilities immediately.” In the same 2009 interview, the transmission from Parker to Al Tracy and the Tracy schools was identified as a major branch of the lineage.

How far the methods spread beyond that is harder to document. Stephen Oliver’s recollection is that dance-studio methods came to permeate much of the Kenpo and Kempo world, including the Fred Villari studios. Villari’s lineage, however, runs through Nick Cerio and William Chow rather than directly through Parker, and we found no source recording how his studios acquired their business methods. We record the observation, not a line of descent.

How did the Chuck Norris and Bob Wall schools become a chain?

Chuck Norris opened his first studio in Torrance, California, in 1962, after leaving the Air Force. In 1966 Bob Wall and the champion Joe Lewis opened the Sherman Oaks Karate Studio. In 1968 Lewis, who by most accounts preferred competing to running a school, sold his share of the studio to Norris. By the early 1970s the Norris studios in Southern California had grown to six locations: Torrance, two in Redondo Beach, Sherman Oaks, Lakewood and Granada Hills.

Norris made his film debut in 1968 and moved steadily into acting through the 1970s. Community accounts say he and Wall sold the chain to a corporation, later bought the schools back and sold them individually to their black belts. We have not found a documented date or buyer for that sale.

Burleson told this journal that he also taught his system to Norris, Wall and Lewis, whom he knew from the tournament circuit, and he said elsewhere that he and Norris “owned karate schools together for a while.” Stephen Oliver’s recollection goes further: that Burleson, by then living in Los Angeles, helped arrange Lewis’s sale of his half of the Sherman Oaks studio to Norris and helped Norris and Wall build out the chain. That specific role is not confirmed by any published source we could find.

Who was Nick Cokinos, and why did EFC matter?

Nicholas P. Cokinos (1921–2014) arrived in martial arts already knowing how an instructional business worked. He had been with Arthur Murray and later operated seven Linkletter–Totten dance studios in the Washington area. In 1967 he began working with the Jhoon Rhee organisation, as it was growing from one school to several. With Grand Master Jeff Smith, Rhee’s champion and one of his leading operators, he built and ran the business systems of the Rhee schools.

Out of that work came Educational Funding Company. EFC dates its founding to 1967; our own profile uses 1968, the year its services extended to martial arts schools in general. On its surface EFC was a tuition-billing company. In practice it was a school for school owners. It taught enrollment, retention, cash flow, payroll and profit, and it expected owners to know their inquiries, appointments, shows and enrollments every week. By the early 1990s, published reports described it as handling the finances of more than 700 martial arts schools. Our longer profile is Nick Cokinos: The Man Who Helped Turn Martial Arts Into a Profession.

Stephen Oliver’s recollection: Cokinos and Jeff Smith spent years studying how other organisations, the Norris schools among them, were putting the same ideas to work, and folded what they learned back into EFC’s teaching. How Rhee and Cokinos were first introduced is not documented; accounts that credit Rhee with seeking out a dance-studio man should be read as oral history.

What was the EFC board, and who served on it?

EFC’s advantage was not its billing software. It was the operators it gathered around the table. Cokinos built a board of directors from high-performing school owners, many of them running several locations, and used it as a working laboratory.

The board was formally constituted in April 1987. In a letter dated 22 April 1987, Nicholas Cokinos, writing as Chairman of the Board, confirmed that nine members had been voted from 17 nominees to serve for the 1987–1988 fiscal year: Dennis Brown, David Deaton, Keith Hafner, Steve LaVallee, Will Maier, Jim Mather, Stephen Oliver, Greg Silva and Don Southerton.

The author was one of the nine. He had opened his own school under Jhoon Rhee in 1975, had been building Mile High Karate since 1983, and had begun coaching other school owners in 1985.

Stephen Oliver’s recollection: through the 1980s and early 1990s, if you wanted high-level material on running a martial arts school, EFC was almost the only place to get it. Members met in person, compared real numbers and heard each other’s results, and that is where the systems were refined.

What came after EFC?

From the early 1990s the job of spreading business knowledge widened into trade associations. The National Association of Professional Martial Artists was founded in 1994 by John Graden, a Florida school owner, and launched Martial Arts Professional magazine in 1996. Other associations, suppliers’ programmes and consultancies followed. The people who built them had, very often, learned the fundamentals in the EFC and Rhee lineage or in the Kenpo schools that grew from the same root.

This history stops there. Trade associations followed, and the lineage had become an industry. The full story, from Jhoon Rhee’s first Texas classes to NAPMA and today’s coaching organizations, is told in The History of the Martial Arts School Business in the United States.

Timeline of record

Frequently asked questions

Where did martial arts school business systems originate?

Largely in the franchised ballroom-dance industry. Arthur Murray and Fred Astaire studios had developed introductory lessons, structured enrollment conferences, prepaid or financed lesson programmes and weekly statistics long before commercial karate schools existed in the United States.

Who first brought dance-studio methods into a karate school?

By his own account, Pat Burleson of Fort Worth, Texas. In the mid-1960s, Fred Astaire licensees who were taking private lessons at his school taught him their sales system, and his enrollment and revenue grew sharply.

How did Jhoon Rhee’s schools become so businesslike?

Burleson said he taught Rhee the system. From 1967 Nick Cokinos, a former Arthur Murray and Linkletter–Totten dance-studio operator, worked with the Rhee organisation and, with Jeff Smith, built the business systems of the Rhee schools.

What was Educational Funding Company (EFC)?

A tuition-management company founded by Nick Cokinos, which dates itself to 1967. It also worked as an education organisation for school owners, teaching enrollment, retention and financial management. By the early 1990s it was reported to serve more than 700 schools.

Did Chuck Norris run a chain of karate schools?

Yes. He opened his first studio in Torrance in 1962. In 1968 he bought Joe Lewis’s share of the Sherman Oaks studio that Lewis co-owned with Bob Wall, and by the early 1970s the Norris studios had six Southern California locations. Norris moved into acting over the same period.

Who served on EFC’s first board of directors?

Nine school owners were elected from 17 nominees in April 1987 to serve for the 1987–1988 fiscal year: Dennis Brown, David Deaton, Keith Hafner, Steve LaVallee, Will Maier, Jim Mather, Stephen Oliver, Greg Silva and Don Southerton. Nicholas Cokinos was Chairman of the Board.

When was NAPMA founded?

The National Association of Professional Martial Artists was founded in 1994 by John Graden. It launched Martial Arts Professional magazine in 1996.