Financing a Daycare Start-Up: Sources & Strategies

Financing a Daycare Start-Up: Sources & Strategies

The idea is ready, the pedagogical concept is written, the premises are found — and now? Now you need money. Financing is the biggest hurdle for many daycare founders. Opening a childcare centre requires start-up capital of CHF 50,000 to over CHF 200,000 — depending on size, location, and fit-out standard.

This guide shows you all the funding sources available to you in Switzerland and provides a concrete example financing plan for a 24-place daycare in the canton of Zurich.

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Start-Up Capital Requirements: How Much Do You Really Need?

The start-up capital requirement depends on several factors:

Factor	Impact on costs
Size of the daycare (12 vs. 36 places)	Directly proportional
Condition of the premises	New build vs. existing space
Location (city vs. countryside)	Rents, wages, renovation costs
Fit-out standard	Basic vs. high-end
Legal form	Association (low cost) vs. GmbH (share capital CHF 20,000)

Typical Ranges

Daycare size	Start-up capital (approx.)
Small daycare (12 places)	CHF 50,000–100,000
Medium daycare (24 places)	CHF 100,000–200,000
Large daycare (36+ places)	CHF 150,000–300,000

These amounts include investment costs (renovation, furnishing, licensing) plus a liquidity reserve for the start-up phase (3–6 months of running costs at low occupancy).

Important: The most common mistake when founding a daycare is underestimating the start-up costs. In the first year, you will probably not be at full capacity. You therefore need money to cover running costs (especially staff and rent) until revenue increases. Plan a reserve of at least 3–6 months' costs in your business plan. More on this in our guide Business Plan for a Daycare.

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Funding Sources at a Glance

Source	Typical contribution	Requirement
Equity	CHF 20,000–80,000	Savings, personal assets
Bank loan	CHF 30,000–150,000	Business plan, collateral
Foundations and funds	CHF 10,000–50,000	Project application, often earmarked
Municipal contributions	CHF 0–100,000	Proof of demand, service agreement
Deficit guarantee	Cost coverage in case of deficit	Municipal council resolution
Private investors	Variable	Return expectation or social motivation
Crowdfunding	CHF 5,000–30,000	Good story, network

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1. Equity: How Much Should You Bring?

Banks and foundations expect you to cover part of the start-up costs yourself. This shows that you believe in your project and are willing to take on personal risk.

Rule of Thumb

• At least 20–30% of the start-up capital should come from your own funds
• For a 24-place daycare with CHF 150,000 start-up capital: at least CHF 30,000–45,000 in equity

Sources of Equity

• Savings
• Early withdrawal from the 2nd pillar (pension fund) — possible for the self-employed or when founding a company
• Early withdrawal from pillar 3a — possible when taking up self-employment
• Loans from family or friends (put it in writing!)
• Founding partners who contribute equity

Caution: An early pension fund withdrawal has long-term consequences for your retirement provision. Seek advice from a specialist before taking this step.

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2. Bank Loans: What Banks Look For

A bank loan is the classic funding source — but banks are more cautious with daycare start-ups than with other industries because margins in childcare are low.

What Banks Want to See

• Solid business plan with a realistic 3-year forecast
• Proven demand (waiting lists, confirmation from the municipality)
• Equity share of at least 20–30%
• Personal qualifications of the founder (HF diploma, professional experience, management experience if applicable)
• Collateral (property, guarantee, municipal guarantee)
• Viable revenue model (ideally with a confirmed subsidy commitment)

Types of Loans

Loan type	Typical amount	Term	Interest rate (approx.)
Operating credit (current account)	CHF 20,000–50,000	Ongoing	3–5%
Investment loan	CHF 50,000–150,000	5–10 years	2–4%
Mortgage (property purchase)	Variable	10–25 years	1.5–3%

Tips for the Bank Meeting

• Cantonal banks are often more open to daycare projects than large banks (social responsibility, local roots)
• Mention municipal contributions or deficit guarantees if available — they significantly reduce the risk for the bank
• Bring the business plan in print and digital format
• Show your personal competence — banks invest in people, not just in business models

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3. Foundations and Funds

Various Swiss foundations support daycare projects with seed funding, project contributions, or loans.

Key Foundations for Daycare Start-Ups

Foundation	Type of support	Focus
Jacobs Foundation	Project contributions, research funding	Early childhood education, quality development
AVINA Stiftung	Project contributions for social innovations	Social entrepreneurship
Mercator Stiftung	Project funding	Education, integration
Ernst Göhner Stiftung	One-off contributions	Social institutions
Regional and local foundations	Variable	Often tied to municipality/region

How to Submit a Foundation Application

1. Research on stvs.ch (Swiss Foundation Directory) for suitable foundations
2. Check the funding criteria — each foundation has its own focus areas
3. Create a project dossier with business plan, pedagogical concept, and financing plan
4. Keep the application short and concise — foundation boards read many applications
5. Demonstrate the impact — foundations want to know what their money achieves

Tip: Many foundations preferentially fund innovative concepts — e.g. bilingual daycares, nature daycares, daycares with inclusion concepts, or daycares in underserved neighbourhoods. If your daycare offers something special, highlight this in the application.

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4. Municipal Contributions and Deficit Guarantees

Many Swiss municipalities actively support daycare start-ups — for the simple reason that they are legally obliged to ensure adequate childcare provision.

Forms of Municipal Support

• Seed funding: One-off contribution to start-up costs (e.g. CHF 20,000–50,000)
• Deficit guarantee: The municipality covers any operating deficit — typically for the first 2–3 years
• Subsidised places: The municipality purchases childcare places and passes them on to families at reduced rates
• Favourable rental conditions: Municipal properties at reduced rents
• Childcare vouchers: The municipality issues vouchers to parents that you can redeem as a provider

How to Proceed

1. Contact the municipal administration (Social Affairs or Education department)
2. Present your proof of demand — show that the municipality lacks places
3. Offer a service agreement — the municipality gains transparency about your quality and finances
4. Be patient — municipal decisions take time (often a council resolution or vote is required)

More on this in the guide Subsidies for Providers.

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5. Private Investors

Private investors are rather rare in the daycare sector, but not out of the question.

Who Invests in Daycares?

• Impact investors: People who want to achieve a social impact alongside a financial return
• Local entrepreneurs: Employers who want to secure daycare places for their employees (company daycare or reserved places)
• Family offices and foundations with an investment strategy: Social investments as part of the portfolio

What Investors Expect

• Transparent financing and reporting
• Clear governance (ideally an association board or foundation board with external members)
• Moderate but sustainable returns (2–4% realistic for daycare projects)
• Influence on strategic decisions (seat on the board/foundation board)

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6. Crowdfunding: An Option for Daycare Start-Ups?

Crowdfunding works surprisingly well for daycare projects — because childcare is a topic that resonates emotionally with many people.

Platforms

• wemakeit.com — the largest Swiss crowdfunding platform
• lokalhelden.ch (Raiffeisen) — specialised in local projects
• funders.ch — for non-profit projects

Success Factors

• Local connection: Emphasise that the daycare serves the municipality/neighbourhood
• Emotional story: Tell people why you want to start this daycare
• Specific amounts: "With CHF 5,000, we can set up the garden playground"
• Rewards: Offer meaningful rewards (e.g. priority waiting list spots, invitation to the opening event, naming rights for a room)
• Activate your network: Crowdfunding works through personal networks — start with friends and family

Realistic Expectations

With a well-prepared crowdfunding campaign, you can raise CHF 5,000–30,000. That is not enough for the entire financing but can make an important partial contribution — for example, for fitting out the outdoor area or the initial equipment.

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7. Rent vs. Buy: What Makes More Sense?

The property question has a massive impact on capital requirements.

	Rent	Buy
Start-up capital requirement	Low (deposit + renovation)	Very high (mortgage + equity)
Monthly costs	Rent (CHF 4,000–8,000)	Mortgage interest + amortisation
Flexibility	High (termination possible)	Low (long-term commitment)
Design freedom	Limited (landlord must agree)	High
Long-term asset building	No wealth accumulation	Property as an asset

Recommendation

For most daycare start-ups, renting is the more sensible option — the capital requirement is significantly lower, and you can invest your money in staff and quality instead of property. Buying only makes sense if you are planning long-term and have sufficient capital (or access to a favourable municipal property).

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8. Liquidity Planning: Surviving the First 12 Months

Liquidity planning is the most critical part of the financing. Many daycare projects fail not because of the idea but because the money runs out before the daycare reaches full capacity.

Typical Cash Flow Progression

Month	Occupancy	Revenue (approx.)	Expenses (approx.)	Cash flow
1–3	30–50%	CHF 20,000–35,000/mo.	CHF 55,000/mo.	–CHF 20,000 to –35,000/mo.
4–6	50–65%	CHF 35,000–45,000/mo.	CHF 55,000/mo.	–CHF 10,000 to –20,000/mo.
7–9	65–80%	CHF 45,000–55,000/mo.	CHF 56,000/mo.	–CHF 1,000 to –11,000/mo.
10–12	75–85%	CHF 50,000–58,000/mo.	CHF 56,000/mo.	±0 to +CHF 2,000/mo.

The cumulative liquidity requirement in the first 12 months can amount to CHF 80,000–150,000. You must have this money — either as a reserve or as an agreed credit line.

Tips for Liquidity Planning

• Stagger staff hiring: Don't hire the full team immediately; grow with occupancy
• Negotiate payment terms: Ask suppliers for longer payment terms during the start-up phase
• Request advance payments: Ask parents to pay monthly in advance (beginning of the month rather than end)
• Keep a credit line ready: Arrange a current account credit with the bank as a safety net

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Example Financing: 24-Place Daycare in the Canton of Zurich

Here is a concrete financing example:

Start-Up Costs

Item	Amount
Renovation and conversion	CHF 60,000
Furniture and fittings	CHF 25,000
Play materials	CHF 8,000
Kitchen equipment	CHF 15,000
Outdoor area	CHF 10,000
IT, software, admin	CHF 4,000
Licensing, consulting, incorporation	CHF 8,000
Liquidity reserve (6 months)	CHF 120,000
Total	CHF 250,000

Financing Mix

Source	Amount	Share
Equity (founders)	CHF 60,000	24%
Bank loan (cantonal bank)	CHF 80,000	32%
Deficit guarantee (municipality)	CHF 50,000	20%
Foundation contribution (Jacobs Foundation)	CHF 30,000	12%
Crowdfunding	CHF 15,000	6%
Family loan	CHF 15,000	6%
Total	CHF 250,000	100%

Note: This is an illustrative example. The actual financing depends on your individual situation, location, and local conditions.

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Legal Form and Financing

The choice of legal form affects funding options:

Legal form	Equity requirement	Liability	Popular with
Association	No minimum capital	Association assets	Non-profit daycares, parent initiatives
GmbH	CHF 20,000 share capital	Share capital	For-profit daycares
Cooperative	Variable share certificates	Cooperative assets	Parent-led daycares
Foundation	CHF 50,000 foundation capital	Foundation assets	Long-term, non-profit projects

More on this in the guide Legal Form for Childcare.

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Frequently Asked Questions (FAQ)

Can I start a daycare without equity?

Theoretically possible (e.g. as an association with full municipal funding), but difficult in practice. Banks and foundations expect you to contribute your own share. You should bring at least CHF 20,000–30,000 of your own money.

How quickly does the investment pay off?

For a typical 24-place daycare, you can expect a small surplus from year 2–3 onwards (see the example calculation in the Business Plan guide). The investment costs typically amortise in 5–8 years.

What if the municipality offers no support?

Then you must finance through equity, bank loans, and parent fees. Private daycares without municipal support do exist — but they rely on higher parent fees, which can limit demand.

Is an investor worthwhile for a daycare?

An investor can make sense if you lack sufficient equity. However, bear in mind: investors expect a return, and margins in childcare are low. Clarify expectations transparently before entering into an agreement.

Which running costs are often overlooked?

Frequently underestimated: continuing education costs for staff, substitute costs during illness, depreciation on furnishings, audit costs (for associations/foundations), insurance premiums, and the ongoing maintenance of the outdoor area.

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Conclusion: The Right Mix Makes All the Difference

A daycare start-up is rarely financed from a single source. The art lies in the right financing mix: a solid equity share, a manageable bank loan, supplemented by municipal contributions and foundation funds. Liquidity planning for the start-up phase is at least as important as investment financing.

The key points:

1. Plan conservatively — budget for 60–75% occupancy in the first year
2. Secure liquidity — 3–6 months' costs as a reserve
3. Use municipal contributions — they significantly reduce your risk
4. Diversify your sources — the more pillars, the more stable
5. Create a solid business plan — it is the foundation for every funding discussion

Ready for the next step? Create your provider profile on kizi.ch now — even if you are still in the planning phase. This way, you make your project visible early and can start collecting enquiries from parents.

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Sources: kibesuisse — Swiss Childcare Association, Federal Social Insurance Office (FSIO), SECO — Company Formation Checklist, Jacobs Foundation, AVINA Stiftung, cantonal offices for supplementary childcare, Swiss Foundation Directory (stvs.ch). As of: February 2026.