In 1969, Caraulia founded the Karate Institute. On Monday, January 26, 1970, the original Karate Institute school opened at 4179 Pearl Road, in Cleveland, Ohio. Within the year more than 100 members had enrolled for classes at K.I.
Caraulia then met with David Praim and David Prue. Praim and Prue were the directors of the top karate schools in Michigan, and they merged with Caraulia to join his school and expertise with theirs.
By 1971, Caraulia, Praim and Prue affiliated their clubs to form the Karate Institute of America. This was due, in part, to the upsurge of “Fly by night” karate schools producing hundreds of poor quality schools, sporting the name “Karate”. These men merged in an organized effort to promote and maintain quality within the martial arts.