Dozens of childcare centers in Colorado are backed by private equity. Critics fear they put profit before kids

Dozens of childcare and preschool centers in Colorado are run by companies backed by private equity funding.   

Private equity firms use investor money to buy companies with a goal of improving them and selling them for a profit. This kind of investment can help a small childcare business grow and make upgrades, which could be useful in a state like Colorado that has a childcare shortage.  

But many private equity firms have a reputation for cutting staff and raising prices. And that’s concerning to some Colorado lawmakers – especially since more public money is going to childcare and preschool after the state launched its universal pre-K program a few years ago.  

Several legislators at the state Capitol have introduced a bill that aims to establish some guardrails for private equity-backed centers. The proposed rules include requirements to notify parents about upcoming enrollment changes or staff layoffs. 

Journalist Ann Schimke has reported on this issue for Chalkbeat Colorado. She talked with Erin O’Toole about some of the concerns that led to the legislation.  

Chalkbeat found 170 childcare centers in Colorado run by chains that are owned or backed by private equity firms. You can read the reporting and see a list of those facilities here.

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Host and Producer: Erin O'Toole
Producer: Ariel Lavery
Executive Producer: Brad Turner
 
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