How Much Does It Cost to Start a Daycare Center in Colorado?
Starting a Daycare Center in Colorado typically costs between $66,000 and $550,000, with a median estimate of $198,000. Colorado’s cost of living runs 3% 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: May 2026
How Much Does It Cost to Start a Daycare Center in Colorado?
Low
$66,000
Medium
$198,000
High
$550,000
National average: $60,000 – $500,000
Interactive Startup Cost Calculator
Startup Cost Calculator
Daycare Center in Colorado
Options
Startup Costs
$233,200
Monthly Costs
$27,500
First Year Total
$563,200
Full Cost Breakdown
| Cost Category | Low | Medium | High | Notes |
|---|---|---|---|---|
| Facility Lease & Build-Out | $22,000 | $88,000 | $275,000 | Daycare facilities must meet strict state square footage requirements per child (35-50 sq ft indoor + 75 sq ft outdoor). |
| Playground Equipment | $5,500 | $22,000 | $66,000 | CPSC-compliant commercial playground equipment is a meaningful four-to-low-five-figure capital purchase. Engineered wood fiber or rubber surfacing is required. |
| Indoor Furniture & Learning Materials | $11,000 | $33,000 | $88,000 | Plan a meaningful three-to-low-four-figure budget per classroom for furnishings. Infant rooms require cribs as individual mid-three-figure capital items. |
| State Licensing & Inspections | $1,100 | $5,500 | $16,500 | Background checks for all staff and household members are a low per-person cost. Licensing fees vary by state and facility capacity. |
| Staff Hiring & Training | $5,500 | $22,000 | $66,000 | Most states require lead teachers to have CDA (Child Development Associate) credentials or a degree in early childhood education. |
| Insurance | $3,300 | $11,000 | $33,000 | Abuse/neglect liability insurance is mandatory for childcare centers and is the most critical add-on; premiums scale with enrollment capacity. |
| Childcare Management Software | $550 | $2,200 | $6,600 | Brightwheel, Procare, and HiMama are popular daycare management platforms billed on a monthly per-child subscription model. |
| Marketing & Community Outreach | $1,100 | $5,500 | $16,500 | Word of mouth from satisfied parents is the most effective marketing. Pediatrician referrals are also valuable. |
| Working Capital Reserve | $16,500 | $44,000 | $132,000 | Daycares typically fill to a majority of capacity in year 1 and reach near-full occupancy by year 3. |
| Total Startup Cost | $66,550 | $233,200 | $699,600 | Required costs only |
Licenses & Permits in Colorado
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 state-set annual fees that vary by program.
Industry-Specific Licenses
- Retail Food Establishment License — Colorado Department of Public Health and Environment or County HealthCost: Varies — contact agency • Renewal: Annual
- Contractor License — Local jurisdiction (Denver Building and Fire Code Services, etc.)Cost: Varies — contact agency • Renewal: Annual
- Retail Marijuana Store License — Colorado Marijuana Enforcement DivisionCost: Varies — contact agency • Renewal: Annual
- Cosmetology Salon License — Colorado Office of Barber and Cosmetology LicensureCost: Varies — contact agency • Renewal: Biennial
- Real Estate Broker License — Colorado Division of Real EstateCost: Varies — contact agency • Renewal: Every 3 years
- Child Care Center License — Colorado Department of Early ChildhoodCost: Varies — contact agency • Renewal: Annual
- Retail Liquor Store License — Colorado Liquor Enforcement DivisionCost: Varies — contact agency • Renewal: Annual
- Outfitter and Guide License — Colorado Parks and WildlifeCost: Varies — contact agency • 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.
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 close to the national average for Daycare Center startup costs, with a cost-of-living index of 103.1. Compared to neighboring Wyoming ($151,200 median startup cost), Colorado has higher costs for a Daycare Center.
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 a low single-digit ratio for infants and toddlers
- 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 meaningful waitlist of 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; premiums scale with enrollment capacity
- 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
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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.