Hereโs My Takeโฆ
This is a touchy topic.
Back in the day, most school owners clung to business equity like a toddler grips a security blanket. Selling part of your martial arts school to an instructor? That was practically unheard of.
But things have changed. And Iโm glad they did.
Some school owners still want full control, and thatโs fine. Others are happy to bring on partners. The truth? Thereโs no one-size-fits-all. But hereโs how I think about it:
You should only sell equity to someone who is already proving to be an incredible asset that you couldnโt imagine running the business without.
Someone who shows up like an owner before they ever have a title. If you're doing it out of desperation, thinking that giving them ownership will magically fix your problems, it wonโt. Trust me.
Ownership doesnโt turn someone into a leader. It only magnifies who they already are.
Thereโs definitely a different feeling when an instructor has skin in the game. Even owning just 5% of the school, they start to feel like an owner. That emotional investment can deepen their loyalty and leadership. But that feeling doesnโt always translate to real follow-through.
Iโve had equity partners that were amazing. Iโve had others that didnโt work out at all. Just because someone is legally an owner doesnโt mean theyโll act like one.
So how do you value the school?
I like to keep it simple: If your school generates $500K/year, then itโs worth $500K. Want to sell 20%? Thatโs $100K. Clean. Easy. Logical.
But hereโs the most important piece: the contract must protect you.
If that partner ever leaves (or worse, stops contributing but still wants their check), you need a clear path to buy them out or remove them.
Your contract should outline what happens in case of a breakup, whether itโs due to performance issues, a falling-out, or even a tragic accident.
And yes, if youโre in my Black Belt Business Elite program, I give my clients real templates for this stuff, no guesswork needed ๐
Iโve had outside investors offer to buy into my schools before.
We always say no.
Because the money isnโt important. The people are.
If you want to dive deeper into this topic, Iโve got podcast episodes that walk through real stories of school owners selling equity, or even their whole school.
James on how he launches to sell
Donovan on how he sells 10% pieces at a time
Talk soon, and remember, your team can be your greatest assetโฆ or your biggest liability.
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