Gymnasts Flip Over Facility In North Alabama: Huntsville Gymnastics a classic small business

    By | Small Business

    How does a gymnast get to the Olympics? The answer is exactly the same as the punchline to the old joke about how you get to Carnegie Hall: Practice.

    And if you live in northern Alabama, or anywhere close, your best path to practicing prize-winning gymnastics leads directly to James Linderholm, founder and Program Director of the Huntsville Gymnastics Center.

    Huntsville Gymnastics, with locations in Huntsville, Alabama, and the neighboring town of Madison, claims to be the leading gymnastics training center in North Alabama. "We are certainly the best-equipped gymnastics facility in the area," states Linderholm proudly, "and we maintain the lowest coach/student ratio. Our competitive program turns out top-notch gymnasts at all levels." Indeed, Huntsville Gymnastics brought home 33 Gold Medals at State competition level in 2013—but it's the recreational program, the boys and girls who come for just an hour or two a week, for which the gym is best-known.

    I'd Have to Make It Work

    Linderholm's success proves that sometimes you don't need a team of expert advisors to start a profitable business.

    "My thought process didn't really run that way," Linderholm recalls. "I wanted to coach high-level gymnastics. The only way I could do that was if I had a gym. So I decided that I'd just have to make it work. I was pretty confident that if I worked hard enough the business would work too."

    Linderholm, who grew up in England, came late to gymnastics—a discipline where the greatest  athletes often start very young. In fact, he was 16 before he started. "I enjoyed it," he says, "but my main sport was rugby. Then, after I took my law degree at Oxford, I walked into a local gymnastics center one day and said I'd like to practice on their equipment. And they said, 'Well, we need coaches.' I said, 'I don't know anything about coaching.' They said, 'That's not a problem!' In England they have a very good coaching education set-up, and within a few weeks I was learning how to coach."


    All the Good Sides of Teaching

    It wasn't long before Linderholm was coaching—and he really enjoyed it. "It's all the good sides of teaching with none of the bad sides," he laughs. "You have the rewards of being a teacher, but you don't have kids sitting in class who hate math."

    Even after he started working as a lawyer in London, Linderholm continued coaching every evening at a high-level gymnastics club. But he still thought of it just as a hobby.

    Then he got an invitation to join an American law firm. Relocated to Alabama, Linderholm continued coaching—but after two and a half years working as a lawyer during the day, and coaching nights and weekends, he had reached a tipping point. "I was a bit frustrated as a coach," he recalls. "I wasn't that happy coaching in other people's gyms; I thought there were better ways to run gymnastic programs. And frankly my law firm was probably a bit frustrated with me."

    Linderholm decided to quit his day job and open his first gym.


    "Mom and Me" to Competitive Cheerleading

    He started Huntsville Gymnastics in 1993—offering a wide variety of programs. "We teach everything from "mom and me" classes for two and three year olds, to high-school-age gymnasts who train competitively. We even train competitive cheerleading squads. But regular gymnastics is the backbone of our business. The majority of our customers are parents who bring their kids for one-hour-a-week of recreational gymnastics.

    Did Linderholm do a detailed business plan before he opened his doors?

    "Not at all," he laughs. "After I made the decision I applied for a small business loan, and was turned down. But I spoke to a guy at the Small Business Administration who was very good, and he told me about a local business fund that sometimes made loans to businesses like mine—but I'd need to do a business plan and a cashflow forecast. And then he walked me through the process. The cashflow forecast was the single most useful tool I ever used for starting a business. If not for that I would have been hopelessly lost. Most start-up businesses don't do a cashflow forecast, and that's a huge mistake."


    The Biggest Gym In Town

    Linderholm made several decisions that helped the business immensely. For one thing, he made fairly conservative estimates in his cashflow forecast. For another, he decided to rent a large building for his first gym. "If I had been fiscally prudent," he admits, "I would have rented a smaller place to start—but my thought process was: If I have a large gym it will look like this is the place to go. I had three competitors at the time, and I wanted a quick start out of the gate. So before I knew it I had the biggest gym in town."

    Finally, several years later, Linderholm succeeded in buying the building where he had been renting space; he credits this decision with strongly accelerating profitability. "I still tell people," he says, "if you can, and if it makes sense in your business, buy your building."

    Within three years, Huntsville Gymnastics was in the black.


    We Will Be Shutting You Down

    Linderholm's nastiest surprise was all the tax paperwork. At the time nothing was online; you had to look up tables in the back of the booklets, make calculations, fill in blanks by hand. It was tricky, and he made the all-too-common mistake of not budgeting 941 payments. By the end of his second year, Linderholm was in serious trouble with the IRS. "It was, 'Here are the penalties you owe, and we will be shutting you down if you don't pay them directly.' It was a very quick wake-up call."

    The biggest issue for most new businesses is attracting paying customers—but that was never a problem for Linderholm. Most of his gym classes started at 3 p.m., so during the early hours of the day he didn't have much to do. He started visiting public schools and teaching gymnastics in PE classes for free. That was an easy way for Huntsville Gymnastics to start picking up students. Every kid in the school went home with a flyer.


    High-Level Gymnastics

    That kind of off-clock commitment is typical of James Linderholm. "I think people vastly underestimate the amount of time you need to put into a new business," he explains. "I've been doing this for 21 years, and I'm still the first person to arrive and the last person to leave. I often work a 12- to 13-hour day, five days a week, and most weekends too. In most small businesses like mine, the person who starts it has to be a pretty hard worker."

    Although the business has been quite profitable, making a lot of money was never a major goal for Linderholm. "I started this business solely because I wanted to create a high-level gymnastics team," he says, "and I'm very proud that I managed to do that on top of building the business."

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