Katherine Horrigan, founder and CEO of Dance Academy of Virginia, started her studio-owner journey unexpectedly at the beginning of the COVID-19 pandemic, when the studio she’d been directing for 10 years, Adagio Ballet School of Dance, decided to permanently close. She had one month before the fall dance season to decide if she was going to risk opening a new business in order to support the dancers who had lost a home studio. “I realized this was an opportunity to bring everybody back together,” says Horrigan. “I felt very compelled to create an opportunity for the community, and for myself, so I went for it.”
Fortunately, Horrigan wasn’t a stranger to arts management and entrepreneurial endeavors. She was in the inaugural graduating class of the Ailey/Fordham BFA program, and, after a successful performing career with Ailey II, Jessica Lang Dance, Mexico City’s Tania Perez-Salas Compañía de Danza, and others, got her master’s in arts management from George Mason University. She then co-founded her own nonprofit contemporary dance company, Company Danzante, and found success performing and presenting her choreography at Jacob’s Pillow Dance Festival, The Kennedy Center, the Dance Gallery Festival, and more. Meanwhile, in her decade with Adagio, she learned and developed best business practices for a thriving dance studio.
In the past five years, DAV has had quick success in Northern Virginia, tripling enrollment to nearly 1,500. After three years, the company expanded and purchased its own building in Del Ray, also in Virginia, growing from two studio rooms to two facilities and seven studio spaces. DAV’s team grew from six employees to 25 (35 as of this fall), including teachers, administrators, and directors; Horrigan believes her strong, unified team has been key to increasing student enrollments. And the last end-of-year performance saw five thousand audience members, with this year’s Nutcracker being held at the 1,600-seat main theater of Capitol One Hall, in Tyson.
Here, Horrigan shares with Dance Teacher her financial strategy, nonprofit versus for-profit operations, and the importance of professional development.
You grew DAV into a seven-figure company after your first year. What advice do you have for financial growth?
KPIs, key performance indicators, for a studio owner are really important. Look at how many students you’re enrolling and [their] frequency. How you’re doing with retention. How many are converting from a trial class into an actual enrollment. Knowing your data and understanding what it means, and then targeting your focus. Don’t guess.
There are ways to incentivize [how many classes a student takes] through higher-level programming, going on pointe, being in a specific performance, or auditioning for competition. You increase the classes they need to take in order to be eligible.
Use enrollments as a benchmark. Certain investments [such as great front-desk administrators] are going to increase the value of your company because they’re going to create revenue for you. Especially in the beginning, the right investments are investments that are going to help the company grow.
[Don’t be scared to] raise your prices. It’s important to keep up with the times, even if it’s just a bump for inflation. It shouldn’t be hard to justify why things cost more.
It’s important to track cash that is available and cash that is deferred. Deferred revenue is what you’ve received but is not usable until you offer the service. A bookkeeper or accountant can help with that.
DAV has a nonprofit operation in addition to the for-profit school. Why both?
I started the nonprofit to run our productions, the school’s performances, and to offer scholarships. This creates the opportunity for us to produce performances at the level we’d like to; for example, The Nutcracker. In order to rent theater spaces [such as Capital One Hall], we often need to be a nonprofit in order to even apply. We’ve also been able to work with foundations to raise scholarship funds that students can apply for, which goes back into the for-profit school. It’s an interesting model. It requires really careful accounting, but it’s a great benefit.
What advice do you have for directors and educators who aren’t naturally gifted in business? What resources would you point them toward?
Your own professional development is so important. I would start with books, podcasts, and online courses to get yourself some business basics. Dance conferences [such as Dance Teacher Web] have a lot of great knowledge being shared. I also joined several business mastermind groups, not related to dance. There are many books on operations (like Traction, by Gino Wickman), on hiring, being a great leader, and managing a team. Joining accountability groups is so helpful. You can create one with other dance studio owners, or any type of business owner. You don’t want to talk to your employees about your challenges on the business-ownership side. Even one person who you can talk to that’s not in your organization that can be a mentor is highly valuable.