How to Start a Tutoring Center: A Step-by-Step Guide | Franchise Business Review

Blog June 11, 2025 10 min to read

If you’ve ever considered starting a tutoring business, sharpen your pencil—now might be the right time.

In 2024, only 28% of eighth-grade students performed at or above the NAEP Proficient level in mathematics. So it’s no surprise that STEM subjects like math, physics, and chemistry are often requested tutoring services.

The private tutoring market was estimated to be worth $7.7 billion globally in 2022, with projections of a compound annual growth rate of nearly 15% from now until 2030, according to a recent article in Education Next.

When it comes to opening a tutoring center, you’re in the driver’s seat. You can choose the subject, grade levels, operating hours, and pricing. Your decisions shape your business and future, giving you the power to create the lifestyle and profitability you want.

So You Want to Open a Tutoring Center?

You’ll be stepping into a dynamic and increasingly popular industry. Between 1997 and 2022, the number of in-person private tutoring centers more than tripled, according to Education Next.

Tutors’ salaries vary widely. The average annual tutor salary in 2024 was $40,000, with a large segment of the workforce reporting part-time employment, according to the Bureau of Labor Statistics. On average, private tutors charge between $25 and $80 an hour, depending on the tutor’s education level, expertise, and subject difficulty, according to TutorCruncher. Many tutoring centers offer monthly programs that range into the hundreds of dollars, depending on how often students attend and the type of instruction provided.

If you’re looking to open a tutoring business, you’ll be responsible for more than instructing students and collecting payments. You’ll also need to find a location, develop a sound business and marketing plan, hire and pay staff, and manage business finances and operations.

Franchising vs. Going at it Alone

As you consider these options, you’ll need to weigh your tolerance for risk, desire for creative control, and the time and money you can put into your business. Investopedia provides the pros and cons of launching a startup vs. investing in a franchise.

Pros and Cons of Owning Your Own Tutoring Business

Pros	Cons
Creative Freedom: You make all business decisions and handle branding/operations.	Higher Risk: Nearly 50% of startups fail within five years.
Innovation: You can introduce new products and services anytime, keeping your business fresh and exciting.	Unpredictable Income: Revenue can be uncertain without a roadmap.
Entire Profit: You keep all earnings; no advertising or royalty fees.	Resource Intensive: Takes significant time, money, and effort to build a new brand.

Pros and Cons of Investing in a Tutoring Franchise

Pros	Cons
Established Brand: You can attract customers using a recognized name with an existing customer base.	Limited Autonomy: Must follow franchisor’s guidelines, which may limit creativity.
Proven Business Model: You benefit from a tested business roadmap and marketing strategies.	Ongoing Costs: Required to pay initial franchise fees, marketing fees, and monthly royalties.
Built-in Support System: You receive onboarding, training, and ongoing assistance from the franchisor.	Supply Restrictions: Often, supplies must be bought from approved vendors, which can be more expensive.

If you prefer to follow a structured roadmap, you could thrive as a franchise owner. You will be backed by a known brand and get support from the corporate office and fellow franchisees who’ve been in your shoes.

A Successful Tutoring Center Model

Choosing the “best” tutoring model depends on your personal goals, budget, community demographics, and the subject matter you’re interested in teaching.

One of the most effective instructional models is high-dosage or high-impact tutoring, which yields the most significant academic gains in reading and math. This model emphasizes frequent sessions of at least 30-60 minutes and 1:1 or small-group tutoring. Studies from the Annenberg Institute at Brown University and the National Student Support Accelerator show this model can more than double academic progress, particularly for struggling students.

Introducing Mathnasium Learning Centers

Mathnasium Learning Centers offer a successful business model based on high-dosage tutoring. Students take placement assessments, follow established curricula, and receive individualized instruction from trained tutors. They can come in often and advance at their own pace, which appeals to students and their families. Mathnasium’s proprietary method leads to measurable improvements in students’ math performance, with 90% of students seeing an improvement in their school grades, and 93% of parents reporting an improved attitude toward math after attending.

Mathnasium also provides a predictable revenue model for franchise owners. Unlike private tutors who charge hourly rates, Mathnasium operates on a membership-based model. Families pay a monthly fee and students attend sessions regularly. This structure stabilizes your income and supports student growth and family engagement.

You don’t need a background in math education to be a successful Mathnasium owner. Instructors are thoroughly trained in the Mathnasium Method™, enabling you to focus on growing your center while ensuring students receive high-quality, consistent instruction.

“We certainly have folks who are in education or have been in education, but we have a large number of folks in our system who come from business backgrounds, corporate backgrounds, entrepreneurship, franchising in general — or don’t have any experience with any of these areas,” said Kevin Shen, Chief Development Officer at Mathnasium. “We have a very robust training system which will prepare you for anything on the education side, on the business management side — the whole nine to make sure that you’re able to find success.”

Secure Funding

Initial business investments can range from a few thousand dollars to hundreds of thousands of dollars. Most Mathnasium owners typically fund their centers using a combination of personal funds, financing options, and small business support programs.

For example, Mathnasium’s total initial investment ranges from $112,936 to $149,155, which includes:

A franchise fee ($49,000)
Leasehold improvements, technology, furniture, etc.
Working capital to cover the first 3–6 months

Here’s a breakdown of how to secure funding for your tutoring business:

Small Business Association 7(a) loans offer low interest rates and extended repayment terms. Mathnasium is listed on the SBA Franchise Directory, making it easier to qualify for funding. You’ll need good credit, a detailed business plan, and some personal equity (often 10–20%) to qualify for these loans.
Home Equity or Personal Loans can cover part of your initial investment costs. Be mindful that your personal assets secure these loans and carry more risk.

Partner or Investor Contributions can lower your initial investment and split your operational responsibilities. While this approach can reduce your personal financial contribution, you’ll need an explicit agreement on roles and profits.

401(k) Rollover (ROBS) can help fund your business; however, you must set up this up with a qualified ROBS provider and establish a C corporation.

To secure financing, you must create a business plan outlining how you’ll reach profitability. Your plan should include detailed financial projections, your qualifications, a management plan, and a breakdown of startup and ongoing costs. Our Financial Planning for Franchise Ownership workbook helps you make a more informed decision regarding franchise investment. We also have a funding calculator that can show you your options with a few clicks of a button.

Register Your Business: Make a Plan!

You need a sound business plan to become profitable. If you come from a teaching background, creating this plan alone can feel daunting.

“While I felt incredibly secure in my abilities as an educator and leader, I knew I needed a lot of support around running a business,” said Jana Frank, a Mathnasium franchise owner based in Chicago.

Here are some steps you’ll need to take before launching a startup or investing in a franchise.

Find a Location

Choosing your location could be the most important of all the decisions that go into opening a tutoring business. If you’re launching a franchise location, the company’s corporate team can help you pick the best site.

Understand Protected Territories: At Mathnasium, franchisees operate within clearly defined protected territories —not just zip codes. These territories are carefully mapped using key demographic and population data to ensure franchisees have access to a strong potential customer base. The corporate teams provides support in evaluating and finalizing these territories to maximize your long-term success.

Consider Local Demographics: Tutoring businesses serve families and their children. You’ll need to know the demographics of the people in your community and understand how far they’d be willing to travel.

Factor in Building Costs: You’ll need to factor in real estate broker and build-out fees, utility upgrades, and zoning hearings. While you might be able to save money if you set up business in a less accessible location, a prime location can bring in more foot traffic and lower advertising costs.

Review Site Specifications: Pick a location that’s adequate for both employee and customer parking and is handicapped accessible. It also should meet your layout requirements.

Research Your Competitors: Mathnasium suggests choosing a location close to your competition. If they’ve attracted customers in that location, you can benefit from the tutoring awareness they’ve already created.

To simplify the process, Mathnasium provides owners with a Field Support Specialist who helps franchisees find the best appropriate location and open as quickly as possible.

Hire Staff

Even if you love math and teaching students, you must hire and train qualified instructors and employees to help you as you grow. Mathnasium centers at full capacity typically require 6-8 instructors and one center director.

Mathnasium trains instructors to teach children how they learn best, providing them with individual attention and encouragement. At the same time, instructors are encouraged to challenge students to reach their full potential. If you choose to open your own business, hiring and training could consume a large chunk of your time, as you’ll need to create your own training guidelines and job descriptions.

Opening for Business

Launching a learning center involves more than simply running ads when you’re ready to ready to enroll students. It’s equally important to build strong community connections early on. Successful franchisees often establish relationships with local schools, join the Chamber of Commerce, and engage with families in the neighborhood to build trust and awareness before doors officially open.

Sam Younis opened his first Mathnasium Learning Center in Los Angeles in January 2012. Today, he’s a multicenter owner. The ramp-up wasn’t easy, he said. Yet because he already knew his community well, Younis tapped into his relationship-building skills to network and talk about the Mathnasium model to local families.

“Every territory is going to have differences, but Mathnasium offers a multi-pronged approach. They tell you all of the things that you absolutely must be doing and some things you ought to think about doing,” he said. “They give you that toolbox so that when you start, you’re not going to feel completely overwhelmed.”

Take Action

Before opening a tutoring business, take time to assess your strengths and identify any areas where you could use more expertise. A background in math or education can be helpful, but it’s not required. With Mathnasium’s proven business model and comprehensive training, franchisees from all backgrounds have found success.

Mathnasium owners not only enjoy the day-to-day fulfilment of helping kids succeed —they also run profitable businesses with the average center’s operating profit in the six figures. And with ongoing training, marketing support, and a dedicated corporate team behind you, you’re never in business alone. Do your research!

According to a recent Franchise Business Review survey, owners continue to give Mathnasium leadership high marks.