How Much Does It Cost to Start a Daycare Center in Colorado?

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Starting a Daycare Center in Colorado typically costs between $63,600 and $530,000, with a median estimate of $190,800. Colorado’s cost of living runs 6% above the national average, which increases commercial rent and labor costs. LLC formation in Colorado costs $50 to file. Most daycare center businesses take 4-12 months to launch.

Last updated: March 2026

Daycare Center startup costs illustration — typical equipment and setup

How Much Does It Cost to Start a Daycare Center in Colorado?

Low

$63,600

Medium

$190,800

High

$530,000

National average: $60,000 – $500,000

Interactive Startup Cost Calculator

Startup Cost Calculator

Daycare Center in Colorado

Budget:

Facility Lease & Build-Out

$84,800

Playground Equipment

$21,200

Indoor Furniture & Learning Materials

$31,800

State Licensing & Inspections

$5,300

Staff Hiring & Training

$21,200

Insurance

$10,600

Childcare Management Software

$2,120

Marketing & Community Outreach

$5,300

Working Capital Reserve

$42,400

Options

Include 3 months working capital

Employees:Just Me1–34–10

One-Time Costs

$224,720

Monthly Costs

First Year Total

$224,720

Full Cost Breakdown

Cost Category	Low	Medium	High	Notes
Facility Lease & Build-Out	$21,200	$84,800	$265,000	Daycare facilities must meet strict state square footage requirements per child (35-50 sq ft indoor + 75 sq ft outdoor).
Playground Equipment	$5,300	$21,200	$63,600	CPSC-compliant commercial playground equipment costs $8,000-$30,000. Engineered wood fiber or rubber surfacing is required.
Indoor Furniture & Learning Materials	$10,600	$31,800	$84,800	Budget $500-$2,000 per classroom for furnishings. Infant rooms require cribs ($200-$500 each).
State Licensing & Inspections	$1,060	$5,300	$15,900	Background checks for all staff and household members cost $30-$100 each. Licensing fees vary by state and capacity.
Staff Hiring & Training	$5,300	$21,200	$63,600	Most states require lead teachers to have CDA (Child Development Associate) credentials or a degree in early childhood education.
Insurance	$3,180	$10,600	$31,800	Abuse/neglect liability insurance is mandatory for childcare centers. Budget $500-$2,000/year for this specific coverage.
Childcare Management Software	$530	$2,120	$6,360	Brightwheel, Procare, and HiMama are popular daycare management platforms at $1-$3 per child per month.
Marketing & Community Outreach	$1,060	$5,300	$15,900	Word of mouth from satisfied parents is the most effective marketing. Pediatrician referrals are also valuable.
Working Capital Reserve	$15,900	$42,400	$127,200	Daycares typically fill to 60% capacity in year 1, 80% in year 2, and 90%+ in year 3.
Total Startup Cost	$64,130	$224,720	$674,160	Required costs only

Licenses & Permits in Colorado

General Business License

Colorado does not have a statewide general business license requirement. Businesses must register their entity with the Colorado Secretary of State and obtain a sales tax license from the Colorado Department of Revenue if selling taxable goods or services. Many municipalities require a local business license — Denver, Aurora, Colorado Springs, and Boulder all have their own business licensing programs with fees ranging from $25 to $500 annually.

Industry-Specific Licenses

Retail Food Establishment License — Colorado Department of Public Health and Environment or County Health
Cost: $100-$800 • Renewal: Annual
Contractor License — Local jurisdiction (Denver Building and Fire Code Services, etc.)
Cost: $150-$600 • Renewal: Annual
Retail Marijuana Store License — Colorado Marijuana Enforcement Division
Cost: $2,500-$15,000 • Renewal: Annual
Cosmetology Salon License — Colorado Office of Barber and Cosmetology Licensure
Cost: $75-$250 • Renewal: Biennial
Real Estate Broker License — Colorado Division of Real Estate
Cost: $200-$500 • Renewal: Every 3 years
Child Care Center License — Colorado Department of Early Childhood
Cost: $100-$500 • Renewal: Annual
Retail Liquor Store License — Colorado Liquor Enforcement Division
Cost: $500-$1,500 • Renewal: Annual
Outfitter and Guide License — Colorado Parks and Wildlife
Cost: $100-$500 • Renewal: Annual

Home-Based Business Rules

Colorado municipalities regulate home-based businesses through local zoning ordinances. Denver allows home occupations with restrictions on customer visits (typically 1 person at a time), no exterior display, and no storage of commercial vehicles. Colorado State law preempts local regulations that would completely prohibit home-based businesses. The Colorado Cottage Food Act specifically authorizes home-based food production with certain limitations.

Resources

Monthly Operating Costs

After launch, plan for these ongoing monthly expenses for your Daycare Center:

Low

$8,000/mo

Medium

$25,000/mo

High

$70,000/mo

Revenue Potential

Annual Revenue Range

$150,000 – $1,000,000 (annual)

Profit Margins

10-20%

Break-Even Timeline

18-36 months

How Colorado Compares to Neighboring States

Colorado is a higher-cost state for starting a Daycare Center, with a cost-of-living index of 105.7 (national average is 100). Compared to neighboring Wyoming ($180,000 median startup cost), Colorado has higher costs for a Daycare Center.

State	Est. Cost	LLC Fee
Colorado (current)	$190,800	$50
Wyoming	$180,000	$100
Nebraska	$163,800	$105
Kansas	$162,000	$160
Oklahoma	$160,200	$100
New Mexico	$171,000	$50
Utah	$190,800	$54

Common Mistakes to Avoid

1
Underestimating licensing timeline — state childcare licensing takes 3-9 months in most states
2
Not budgeting for staff-to-child ratios — state regulations require 1 teacher per 4-6 infants
3
Skipping abuse/neglect liability insurance — it's mandatory and the most critical coverage for daycare centers
4
Opening without a full enrollment waitlist — use the pre-opening period to build a waitlist of 30+ families
5
Not including subsidy billing in operations — accepting Child Care and Development Fund (CCDF) subsidies significantly increases enrollment

Next Steps to Launch Your Daycare Center

1
Obtain a Colorado childcare facility license from the Colorado Department of Children and Family Services before accepting children
2
Register your Daycare Center as an LLC with the Colorado Secretary of State ($50 filing fee)
3
Pass the Colorado fire marshal inspection — exits, smoke detectors, extinguishers, and evacuation plans are required
4
Complete criminal background checks on ALL staff per Colorado childcare licensing requirements
5
Meet Colorado staff-to-child ratio requirements: typically 1:4 for infants, 1:6 for toddlers, 1:10 for preschool-age
6
Get childcare-specific liability insurance and workers compensation coverage ($5,000–$12,000/year)
7
Install the physical requirements: fenced outdoor play area, age-appropriate bathroom facilities, and kitchen if serving meals
8
Enroll in the USDA Child and Adult Care Food Program (CACFP) to offset meal costs if you serve qualifying children

Frequently Asked Questions

Opening a daycare center costs $60,000 to $500,000. A small home-based daycare for 6-8 children can launch for $10,000-$30,000. A licensed commercial daycare center for 30-50 children typically costs $100,000-$250,000. A large full-service childcare center for 100+ children can exceed $500,000.

State childcare licensing takes 3-9 months on average. The process involves submitting an application, facility inspections (fire, health, licensing), background checks for all staff, staff training verification, and a licensing visit. Start the licensing process immediately after finding your facility.

Capacity depends on your facility size and state ratio requirements. Typical ratios: infants (1:4), toddlers (1:6), preschoolers (1:10-12). A 2,500 sq ft facility at 35 sq ft per child can serve 71 children maximum, adjusted for ratio requirements. Most states cap home daycares at 6-8 children.

Daycare centers can net 10-20% profit margins at full capacity. A 50-child center charging $1,200/month average tuition grosses $720,000/year. After staff labor (60-65% of revenue), rent, supplies, and insurance, net profit runs $72,000-$144,000. The key is maintaining 85%+ occupancy consistently.

Requirements vary by state and staff role. Lead teachers typically need a CDA credential ($425 to obtain), an associate's degree in early childhood education, or a bachelor's degree. Aides may need only 18+ years of age and a high school diploma plus CPR certification. All staff must pass a background check.

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Start a Daycare Center in Other States

See the national overview for Daycare Center or browse all businesses you can start in Colorado.