The Champion Who Conquered the Ring and the School Business!

marketing motivation Dec 04, 2018

Back in the 1970s and ‘80s, legendary fighter Jeff Smith pulled off a dual goal unprecedented back then and extremely rare even today. He became a world kickboxing champion while simultaneously mastering the martial arts school business! Furthermore, he pioneered savvy business techniques still practiced by current school owners. Read Smith’s extraordinary story and prepare to come away inspired! 

 

By Herb Borkland

 

In the early 1960s, when Americans were first meeting the Beatles, Jhoon Rhee, the “Father of American Taekwondo,” owned four schools in Washington, D.C., Virginia and Maryland. He also regularly traveled around the country to a dozen taekwondo clubs, where he tested students trained by some of his black belts. One such club was located in Kingsville at Texas A&M University, where teenaged Jeff Smith’s mother worked and Jeff delivered daily newspapers.

“One day on my route, I noticed a sign for a karate demonstration at the student union ballroom,” Smith recalls. “I went and wanted to enroll [in the club], but it was for college students only. I talked to my mother, she talked to the dean, and they decided to let me and several other of the faculty kids in.”

The college men were not pleased to have young Jeff and a few other kids training among them. 

“Two weeks in, we started fighting, with no safety equipment — pretty hardcore at 14, sparring college guys. This was during the old Texas ‘Blood-and-Guts’ Era, around 1964 and ’65, and they didn’t want little junior-high kids.”

Today, given the legend of seven-time world light-heavyweight champion Jeff Smith, it’s no surprise to hear he not only survived the sparring but thrived on it. Later, as a brown belt, Smith became head instructor there and ran the club for two more years after his 1968 black belt exam. He was also busy making a name for himself competing in those hard-hitting early tournaments in Texas, Oklahoma and Louisiana.

 

Managing Four Schools

In 1970, Jhoon Rhee invited Jeff to Washington to teach at one of his schools. Smith also enrolled at a local D.C. college to put the finishing touches on his business degree from Texas A&M. He was entering history, along with Allen Steen and Pat Burleson, as one of the trio of original Rhee protégés who helped establish teaching martial arts as a proud American profession.

“He had four schools at the time, and I soon realized martial arts was a real business,” Smith explains. “I had thought of it as a club, not as a way to provide a livelihood. This new understanding made me think that, someday, I wanted to have my own school. So, I was learning it all while working for the grandmaster, from the ground up, every phase.”

It became a standing joke in the Rhee organization that no chore was too small for Smith to eagerly take on, to gain experience from. As a university business major, he began to see new ways to make more money, too. For example, having a Masters Club, not just a Black Belt Club, meant the new black belts stayed involved in the school as paying members and continued their training.

“I told the grandmaster I wanted to charge for second dan at a time when the first dan’s only obligation was helping out with classes,” Smith says. “I suggested structured classes and cycles of testing. That meant to keep testing after black belt and make that a step toward second degree. So, we added stripes on belts [between the dan ranks]. I did it at the school [I directly managed] and got 30 upgrades in the first month. So, we then implemented it in the other schools.”

 

Rise to Point-Fighting and Kickboxing Stardom

Meanwhile, Smith’s passion for competition meant engaging in 1970's point-fighting every single weekend. 

“I flew from D.C. to tournaments everywhere,” he says. “There’s not a state in the country where I haven’t competed in a point fight.”

By 1974, Professional Karate magazine voted Jeff Smith America’s number-one point fighter. Having conquered that world, Smith moved onto the then brand-new, much more demanding martial sport of American kickboxing (a.k.a. “full-contact karate.). In September 1974, in the new sport’s inaugural event, he won the first Professional Karate Association (PKA) World Light-Heavyweight kickboxing title, later broadcast on ABC-TV’s Wide World of Entertainment. 

Smith also continued training a new generation of soon-to-be world champions as he managed the business and taught the instructors of the ever-growing Jhoon Rhee Institutes in the Washington, DC area. This, in itself, is an extraordinary achievement. Think about it: The kind of training required to be an elite point-fighter and, infinitely more so, a world-champion kickboxer, is practically a full-time endeavor by itself. (See sidebar story, “Workload Requiring a Martial Arts Superman!”)

 

Rise to Management Stardom

Like he did in his competition endeavors, Jeff Smith quickly soared to the top of his business/management career, too.

“At first, I was hired as an instructor by Grandmaster Rhee,” he explains. “Then, I became Program Director, then Office Manager, then Head Instructor teaching the other instructors. Finally, as General Manager, I taught the other school managers. Nick Cokinos [the Educational Funding company founder] helped Grandmaster Rhee initiate the [business] systems, although they had a falling out a few years later.

“Then, the grandmaster made me Vice-President to keep those innovations running smoothly. K.K. Chung, his brother-in-law, handled the business, marketing and accounting. I wanted to learn to do those jobs, too, to [ultimately] get my own schools. I had made myself a promise when I came to D.C.: To compete until I was 35 and then retire.”

 

Becoming a Black Belt at Business

At that early era in our industry, the vast majority of martial arts schools were run haphazardly. Business-training organizations like the Martial Arts Industry Association didn’t exist. Teaching methods were harsh and unsophisticated. Most instructors just taught classes the rugged old-school way their own tough instructors had taught them. It was a recipe for failure.

This was also true of the many point-fighting and kickboxing champions of that time. A large number of them opened schools based on a false premise. They believed that their names and champion statuses would automatically draw students. they didn’t. Although they were famous in martial arts circles, they were unknown among the general public. Sadly, but understandably, most of the schools run by these champions soon went out of business. Most of them eventually either taught classes for other successful school owners or independently taught clinics on the then newly developing national seminar circuit.

Meanwhile, Jeff Smith was not only conquering the martial arts school business, but was also creating new innovations of his own design.

There was a lack of understanding about marketing, teaching an intro lesson, and keeping students long enough to upgrade. Most owners weren’t looking at the total value of a student who stays active for six years. As Smith saw it, the problem was a matter of retention: Getting students to commit to the rank of black belt and beyond.

“It was a matter of how you pre-frame them into realizing that our major benefits are no different than going to college,” says Smith. “You don’t go to college to drop out as a freshman. If you get to black belt, you now have lifelong skills for a higher level of discipline, respect and confidence, not just self-defense.”

Jhoon Rhee instituted a rule that, to receive their black belts, kids had to also earn an A or B average in school. 

“All of the instructors objected that this would lose students,” Smith says. “The Grandmaster argued that, although some students may not be making those kind of grades when they start training, by the time they reach black belt, they would. He believed the rewards of more personal discipline and greater ability to concentrate would enable them to improve scholastically.”

 

According to Smith, Grandmaster Rhee was right

“Ninety-five percent of our students earned a patch for the Academic Team. Not every student got one, but, nonetheless, they all were better motivated to study. And the parents were in love with us! 

“I soon realized retention is key to the success of a school. It’s like having holes in a water bucket. Students spill, so you need more and more students to keep the bucket full. What counts is not how many new enrollments you get but your net retention. You didn’t just add 20 newcomers if 10 former students leave.”

What gradually became standard business practices for Smith were groundbreaking policies way ahead of their time: Things like retention cards, callbacks, and a statistic sheet to correlate information. All these were done at a time when few schools even kept averages on enrollment, info calls, number of intros, how many people tested each month, and how many renewed to a higher-level program.

“All these are key ingredients,” Smith realized back then, “and this gave owners control in a business sense. We shared teaching methods, but all our top instructors added new ideas to what was already being invented by people like [Rhee black belts] Pat and John Worley and Larry Carnahan.”

Smith eventually hired over 25 instructors out of Jhoon Rhee clubs from all across the country, and they would later open their own schools. There were no franchise fees. They paid only for the use of Jhoon Rhee’s name for belt-testing and diplomas. This helped guarantee they faithfully used the grandmaster’s system. Rhee was sure of this because either he tested their students or he sent Jeff to do it.

 

Sharing a Common Vision

As the popularity of martial arts training grew in the U.S. and prospective students became more sophisticated, so, too, did the marketing and systems techniques used throughout the Jhoon Rhee schools. 

“Our two-hour staff sessions were not enough [to keep up with a changing marketplace]. So, I had to do [new business innovations] myself, so that the other school managers could see how to,” Smith explains. “Some did better business than I did. So, the best school for the week was always copied by the rest.

“We mentored each other by concentrating on top performers — those with more renewals, more students at tests, etcetera. We kept strict numbers on retention and dropouts. A dropout was considered anybody gone for one week. So, we had attendance cards and call lists and percentage numbers. We competed with each other.”

Smith likes the old expression, “A rising tide lifts all boats,” because that was exactly what was happening.

“We copied each other’s successes,” he points out. “I gave them homework, like studying motivational sales experts’ audiotapes and videos. They rotated weekly, then reported an overview of what they got out of it. I made them read all the motivational books. 

“How did I motivate myself? Tapes! I shared my training tips, too.”

Just as these group efforts improved everybody’s business, the same strategy of sharing also sharpened their competitiveness. Smith traveled to tournaments with a home-grown team which, in five weight classes, included either a world champion or someone ranked number one nationally, except for heavyweight division. When light-heavyweight Smith switched to kickboxing, the team did, too. When one did better, it made the others redouble their efforts, and they learned from each other.

“The better your training partners, the better you do all over the world,” he states. “Having such a stable made us all better. Many of them are still running successful schools today by using the methods we did.”

The educational tapes, the implementation of new business systems, and a constant desire to train harder and learn more paid off big time. The cumulative results of sharing a common vision produced excellence at all levels. No other schools nationally were doing better business-wise, and the Rhee Institutes were producing the top fighting and forms competitors. 

 

All Goals Accomplished! 

“When I turned 35 [in 1982], I retired from competition as planned and took over two of Grandmaster Rhee’s schools, while I was still training the staff in all his other [10] locations. The Grandmaster had given me stock in his company, which I exchanged for ownership of two of his schools. I ran them for a number of years and expanded my own schools when Rhee’s son took over his father’s business.” 

By the late 1980s, Smith was not just a black belt at the school business, he had become a full-blown grandmaster! His retention techniques were so polished that his retention ratio at one point soared to a phenomenal 90%, the best in the U.S. Back then, most professional schools were routinely striving for 50%! Even today, with all of our sophisticated and streamlined systems at play, a meager 10% dropout rate is practically impossible to achieve.

Further, Smith was also known industrywide as a very savvy money manager. Although he would never admit to it, back then or now, it was widely rumored that he was one of the rare millionaires in our industry. He had built his fortune on profits from his thriving schools and smart financial management. 

Jeff Smith turned 70 in 2017. He sold his schools some years ago, but says he does continue to train, running and lifting weights, three or four days a week. 

He now also appears to play just as hard as he used to work, if you’re privy to his multitudinous Facebook posts. He spends some of his spare time as a pitcher on a baseball team and plays tennis and billiards. He takes cross-country jaunts on his Harley motorcycle. He sky dives, bungee jumps, and kayaks through Class Five and Class Six whitewater rapids.

So, here in his senior years, he seems to be enjoying the deserved fruits of his lifetime of hard work, long hours and goal-attainment. But it was all invested in doing exactly what he loved! 

Uniquely, Jeff Smith conquered two worlds, while most mere normal mortals among us are satisfied if they can conquer just one. He is truly the living embodiment of achieving the American Dream.

 

 Jeff Smith can be contacted at [email protected]

 


Herb Borkland is a veteran black belt and freelance writer based in Front Royal, VA. He can be reached at [email protected]

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