Chapter 5: Trial, Error and Hobo Shit

Another influential creature – The Pup (and his beautiful wife Mamacita)

On November 1st, 2005, we moved to our second location on East 2nd Avenue, just a few blocks away from our first facility.

The location was a lot better than the first one as we now knew how to design, set up and build a world-class gym. By we, I mean The Pup. The Pup has single-handedly built (by hand) every custom piece of equipment we own. Those awesome pull-up bars hanging from the ceiling – The Pup. (The CFHQ training crew see a ton of gym set-ups, and whenever one of their coaches come to visit, they tell us ours is by far the best).

Our new facility was definitely a step-up, but this was still East Van five years before the Olympics: It wasn’t uncommon to find human feces at our doorstep. One day, The Pup was speeding around the corner of his first lap of Helen and stepped in a gigantic log of hobo shit. He took one look at the bottom of his shoe, and as the smell hit his closest nostril, all hesitation evaporated. The shoes went straight into the dumpster, and he continued on in his little white socks.

To this day, The Pup epitomizes how we want each of you to behave in our school. He is the heart and soul of our membership – the Jonny Toews of MLS. Follow this guy’s lead and you will be fitter than you ever imagined and still be stoked to come to the school 10 years from now.

At this point, I had recognized the value of personal training. My personal training business had earned me $5,000 a month on my own, and the moment we changed to a group class ‘Mossecock’ model at the Terminal location, we nearly got destroyed.

We had 80 members doing group classes and were making less money than when I had had just 30 personal training clients. I knew the answer was that I couldn’t continue to run my business like a spin class or yoga studio, and I intended to abandon that immediately.

It was like a fleeing ratship. My partners left the business, the girls we had hired to coach group exercise moved on, and ironically the only people who were still around were my loyal personal training clients.

I consolidated classes, kept one in the morning, one in the evening, and went back to personal training.

In October of that year, T-Bear left his career in engineering, and just showed up at my one bedroom apartment with his BMW X5 towing a u-haul trailer. “Where the fuck you going, Bear?” I asked. “Moving in with you, Patterson” he replied.

So we moved a bunch of stuff around and made a little dog bed for the Bear under my desk.

Here I was, 33 years old, broke as fuck, with a refugue posted up in my living room. “T, why is there a roll of toilet paper by my computer?”

Shit looked grim, but we had tons of energy and a system that was starting to work.

We still didn’t have a sign on our door, and no one had ever heard of CrossFit. But we were picking up clients and growing.

We got the Bear into shape, too (after he rehabbed from a broken back), and by February 2006, he started coaching with me at our East 2nd location.

Within one year, I paid off my $73,000 debt and added another $50k in cash surplus, but more importantly, we were having the time of our lives and getting a shit ton of people fit. Our community started to thrive.

I soon took on two new coaches — Sheppy and Andy Nutts — who I put through our unofficial coaching apprenticeship program. They started by shadowing me and then eventually started working with their own clients.

By April, 2007, we had somewhat standardized what worked and what didn’t work. Things started to roll. Life was good. The next few years were the happiest time of my life.

Our success came largely because our new standard became 10 to 12 personal training sessions before group classes. As a business, we were bringing in $50,000 of revenue a month, and I was contributing $20,000 of it with my own clients.

We were achieving these numbers without any advertising or marketing. In fact, it turned out our website was broken. As people contacted our us online, their inquiries were sucked into an abyss somewhere on the internet, never making their way to our inbox. We realized this in mid-2007 when we discovered 400, mostly outdated e-mails, from people inquiring about joining.

The one problem we were having was location. Again.

At first, our East 2nd location seemed like a great facility. We could run on the streets, had good natural light, lots of parking, ok bathrooms.

But we had one massive problem: Our neighbours were in the recording business. They’d be recording a commercial and someone would drop a weight and they would go ballistic. Someone would run into the facility and scream that we’d fucked up their recording and there would be hell to pay. Then they’d have to re-record. Luckily, I was training the owner of the recording studio’s wife, Carlotta. She had a lot of pull over there. We managed to negotiate times where we could drop weights and times we needed to be quiet, but it wasn’t ideal. Eventually, we had to move. We were growing too fast.

Back to business model rule six from chapter 4:Location! To add to this point, make sure you get to know everything about your facility before you sign a lease. Moving is expensive. We moved three times in five years. It took us four facilities before we figured this out and finally got it right.

Part of getting it right requires the following facility dealbreakers: High ceilings, bay doors, plenty of free parking, adequate square footage to accommodate future growth, nice bathrooms with showers, natural light, the ability to drop weights and the ability to run on the street. A couple other nice luxuries to have: A lounge for socializing, and space to accommodate rehabilitation.

In 2007, we hadn’t figured this out yet.

By now it should be clear to everyone I’m not a geniuus, but as my good friend Dan “The Dood” MacDougald says in his southern accent, “It’s not about how many mistakes you make. It’s about how you learn from them.”

Then I made another huge mistake. Falsely driven by the concept that the free market takes care of everything and is a perfect system, I decided to open the floodgates to anyone who wanted to coach. We (CFHQ’s first cert in Canada) certified 10 new coaches and gave them the keys. They started earning 70 percent of the revenue they generated, while the gym kept 30 percent. Problem was we weren’t training them properly. There was no mentorship. And it became pretty clear in a hurry that a two-day course didn’t mean they were qualified to coach.

Business lesson number eight: Take on one apprentice at a time.

You actually have to spend time with your apprentices as their mentor. We’ve learned it takes two to three years to properly develop a coach. You have to put all your energy into this person and get them to a place of self-sufficiency. At that point, you can take on a second coach. One person can’t take on five apprentice coaches at once, unless that’s all he’s going. But if you’re running a business and coaching clients yourself, one at a time is plenty.

The 70-30 system put me back on the path to bankruptcy. Business lesson nine: (Factoring in rent and other fixed and unexpected costs,) payroll can never exceed 50 percent of revenue. Or you will go bankrupt.

Not only that, but handing coaches 70 percent too early led to arrogance and feelings of entitlement. Coaches need to earn their way up the ladder. Business lesson number ten: Don’t give away too much too soon. Treat your coaches like business owners, and make them earn their way to success. See Shakesphere’s “King Lear”.

We abandoned the 70-30 for a more moderate 60-40 system. Today, coaches start out by making 20 percent as apprentice coaches and work their way up the ranks until they eventually earn 50 percent of the revenue they generate.

We have found this system of earning your way through the ranks creates understanding and appreciation: Our coaches are independent contractors who truly understand what it’s like to build a business from the ground up.

At this same time in 2007, I found myself on the fast track to burnout. I was working 45 hours on the floor coaching. Business model rule eleven: Coaches should coach between 20 and 30 hours a week. Coaching quality goes down after four or five hours a day. You should also create morning and evening coaching teams, so nobody has to coach at 6 am and then again at 8 pm.

While we’re on the subject of mistakes and lessons, another mistake I’ve seen many owners make is they stop coaching too soon. Once the gym consistently reaches $50,000 to $60,000 in revenue a month, pays the owner $5000 a month, and the business can earn 15-20% profit, then the owner can stop coaching and focus on coach and business development. These are the principles for long-term success.

Once one of our MadLab Group member gyms achieves those numbers, they become a Two-Seal Facility. At this point — $50,000 revenue, $5,000 salary and 15% profit — it makes sense for the owner to get off the floor and focus on other aspects of the business. Dave Picardy (Now VP sales of Madlab Group) of Northshore CrossFit in Boston tried to do otherwise. He came off the floor too early, and it was devastating for his business. He went back on the floor building his clients and coaches. He now has one of the best coaching teams in the world.

As we figured all of these lessons out, we built a crazy great team of coaches, loaded with character. We had a shepherd, a little green frog, an urban monk, a coach everyone simply called “NUTTS”, a ruffled grouse, and Captain “Happy” in the crows nest pointing the way. The Wildebeest turned the tiller to our next location, “The Barn.”

Tuesday Lesson Plan

Warm Up: Coach Choice

Include Power Box Jumps

Strength/Skill:

8R Barbell Hip Thrust

Stick with sets of 8 throughout until heaviest set is achieved.

Use blocks at 9-11″. See what your glutes are made of!

Increase weight on barbell as long as the gluteal contraction is maintained.
Posteriorly tilt the pelvis at the top of the movement. Ribcage down, crotch to face.

Conditioning:

4 Rounds:

50 sec Thrusters 75/55
10 sec Transition
50 sec Push Ups
10 sec Transition
60 sec Bent Hollow Hold
60 sec. Rest

20 Points for 60s Bent Hollow Hold
0 Points for anything under 60s.