How to start a daycare, preschool or tutoring center

Staff ratios decide the business. Florida allows one adult for four infants but one for 20 four-year-olds, so the age mix a child care center or family child care home chooses sets payroll before rent does. Licensing, background checks, subsidies and insurance follow, with the agencies and statutes named. Tutoring is the opposite case, with no state license found in the states researched.

By Niomi AscotUpdated October 3, 202616 min read

Child care license: Every state licenses it; Florida from more than five unrelated children for pay
Background checks: Federal floor: state and FBI fingerprints before hire, repeated every five years
Florida ratios: 1:4 infants, 1:11 two-year-olds, 1:20 four-year-olds; license number in every ad
Texas insurance: Liability cover, or written notice to parents without it; $300,000 per occurrence in the statute, $100,000 under H.B. 2789 if signed
Tutoring license: None found in the states checked
COPPA: Amended rule; child-facing apps and portals have had to comply since April 22, 2026

What the business is, and the ways to run it

Two federal codes split this trade. NAICS 624410, “Child Day Care Services,” covers “day care of infants or children,” usually preschoolers, including programs that “may also offer pre-kindergarten and/or kindergarten educational programs” and before- and after-school care (NAICS 624410). NAICS 611691, “Exam Preparation and Tutoring,” covers “preparation for standardized examinations and/or academic tutoring services” (NAICS 611691). They share a buyer and little else.

The Census counts show the scale. County Business Patterns for 2023 lists 82,162 child day care establishments with employees, 1,045,052 workers and $31.03 billion in payroll. Tutoring and exam prep had 9,820 establishments and 108,755 employees (Census CBP 2023, computed from the national file). Another 533,596 child day care businesses had no employees and $11.14 billion in receipts (Census Nonemployer 2023), most of them home providers.

The legal lines between the models, using Texas definitions (Tex. Hum. Res. Code 42.002) as the example:

A child care center cares for “seven or more children under 14 years of age” away from the operator’s residence, at least two hours a day, three days a week.
A family home cares for “not more than six children under 14 years of age,” not counting the caregiver’s relatives, plus a few after-school children, with no more than 12 in total. A group day-care home is a residence caring for “seven or more children.”
A before- or after-school program serves “prekindergarten through grade six” around the school day and holidays.
A private preschool is licensed as child care, and in Florida it can also run the state’s free pre-K (below).
A tutoring or test prep center, or a tutor who travels to homes, which no state checked for this guide licenses.

The outlook for the people you will hire

BLS figures published through O*NET, with 2025 wages and 2024 to 2034 projections:

Occupation	Median pay, 2025	Employed, 2024	Projected growth	Openings, 2024 to 2034
Childcare workers (O*NET)	$16.82 an hour	991,600	Decline (-1% or lower)	160,200
Preschool teachers (O*NET)	$18.34 an hour	555,100	Average (3% to 4%)	65,500
Preschool and daycare directors (O*NET)	$28.51 an hour	90,200	Decline (-1% or lower)	5,500
Tutors (O*NET)	$20.84 an hour	215,500	Slower than average (1% to 2%)	37,100

Openings outrun growth because O*NET counts “growth and replacement,” which in child care mostly means turnover.

Demand is not the problem. Child Care Aware found “the national average annual price of child care in 2025 was $13,184,” that licensed centers “declined slightly (1%) from 2024 to 2025” while family child care homes rose 1.4%, and that “Only 15% of eligible children receive federal subsidies” (Child Care Aware). On the tutoring side, school leaders estimated “32 percent of their students ended the 2023-24 school year behind grade level in at least one academic subject” (NCES).

Licensing: the federal floor, then your state

Rules that apply in every state

Background checks. Federal child care funding law requires a check that includes the state criminal and sex offender registry in every state the staff member “resided during the preceding 5 years,” state child abuse and neglect registries, the National Crime Information Center and “a Federal Bureau of Investigation fingerprint check,” repeated “not less than once during each 5-year period.” States must return results “as expeditiously as possible, but not to exceed 45 days” (42 U.S.C. 9858f). Programs “must submit requests for background checks before the staff member is hired” (childcare.gov), so a 45-day wait can sit between hiring and the first shift.

Public inspection records. “Federal law requires states and territories to post the results of child care monitoring and inspection reports online” (childcare.gov). Your first citation will be readable by every family that tours.

The ADA. The Justice Department says “Privately-run child care centers … must comply with title III of the ADA,” and “Even small, home-based centers that may not have to follow some State laws are covered.” A center cannot exclude a child with a disability unless the child would “pose a direct threat” or “require a fundamental alteration of the program,” and if a service “is required by the ADA, you cannot impose a surcharge for it.” Centers “actually run by religious entities” are exempt (DOJ ADA guidance).

Three states compared

As of October 2026, from the statutes and rules read for this guide. Confirm current requirements with the licensing agency before you sign a lease.

State	Agency	When a license applies	Key requirements, as the law states them
Florida	Department of Children and Families, or a county licensing office	Care for “more than five children unrelated to the operator” for pay	Ratios from 1:4 infants to 1:25 school-age; level 2 screening; 40-hour course; license number in every ad
California	Department of Social Services, Community Care Licensing Division	Centers and family child care homes	Center ratios 1:4 infants, 1:12 preschool; orientation before a home application; small homes up to 8 children
Texas	Health and Human Services Commission, Child Care Regulation	Centers, group homes, licensed or registered family homes, school-age programs	Liability insurance or a written notice to parents; $300,000 per occurrence in the statute as read, $100,000 in the enrolled H.B. 2789, whose signing could not be confirmed
Tutoring, all three	No licensing agency found	Not licensed as such	Screening for contractors on Florida school grounds; Google checks for its Tutor ads

Florida: ratios, credentials, screening and the ad rule

A Florida “Child care facility” is any arrangement “which provides child care for more than five children unrelated to the operator and which receives a payment, fee, or grant” (Fla. Stat. 402.302). The standards in Fla. Stat. 402.305:

Ratios. One staff member for every four children from birth through age 1, six at ages 1 to 2, 11 at 2 to 3, 15 at 3 to 4, 20 at 4 to 5 and 25 at 5 and older. A mixed group is staffed by “the age group with the largest number of children within the group.”
Ages. No operator under 21, and no employee under 16 unless supervised and not counted in the ratio.
Training. Staff start the “40-clock-hour introductory course” within 90 days of hire, finish within a year by passing a competency exam, and then complete “10 clock hours” of in-service training a year.
Credentials. For every 20 children in a facility open 8 or more hours a week, one staff member must hold “A child development associate credential” or an equivalent, and the director needs “A credential for child care facility directors.”
Screening. “Level 2 standards for screening,” including “employment history checks, a search of criminal history records, sexual predator and sexual offender” registries.

Homes have their own path. Where a county does not license them, “family day care homes shall register annually with the department,” with a plan for “at least one other competent adult” to step in during an emergency and screening of household members “over the age of 12 years” (Fla. Stat. 402.313). A home caring for up to 12 children as a large family child care home “must first have operated as a licensed family day care home for 2 years,” with an operator who has held a CDA or equivalent for a year (402.302).

Two Florida rules decide how you market and where you open. No one may advertise a child care facility “without including within such advertisement the state or local agency license number or registration number,” and a violation is “a misdemeanor of the first degree” (Fla. Stat. 402.318). And a licensed or registered family day care home “shall constitute a valid residential use for purposes of any local zoning regulations,” with no special use permit allowed and no “special fee in excess of $50” (Fla. Stat. 166.0445).

California: center ratios and family child care homes

The Community Care Licensing Division licenses “family child care homes, which provide care in the provider’s own home, and child care centers, which are usually located in commercial buildings,” and inspects for “staff training, background checks, ratios, care and supervision, emergency preparedness.” The state counts “over 44,000 licensed child care facilities,” about 13,600 centers and 30,400 homes, and small homes “are licensed for a capacity of up to 8 children” (CDSS fact sheet).

Center ratios are set in Title 22. A preschool room allows “one teacher visually observing and supervising no more than 12 children,” or “one teacher and one aide for every 15 children” (22 CCR 101216.3); an infant room needs “one teacher for every four infants” (22 CCR 101416.5). Programs funded by the state Department of Education follow Title 5 ratios instead.

For a home, the orientation comes first: “We will not accept your application until after you have completed the orientation,” and the application fee is “nonrefundable” (CDSS home licensing). As of October 2026, “The orientation fee is $25.00 per person for Family Child Care Homes” (CDSS fees). The current application fees by capacity, the large-home capacity and the state’s zoning rule for homes could not be read for this guide, so get those from CCLD directly.

Texas: operation types and the insurance change

Texas sorts care into the operation types listed above, from listed and registered family homes to centers and school-age programs (42.002). Its distinctive rule is insurance. Section 42.049 requires a license or registration holder to “maintain liability insurance coverage,” to “annually file with the commission a certificate,” and, if it cannot get coverage, to give each parent “a written notice that the liability coverage is not provided” (Tex. Hum. Res. Code 42.049). The version on the mirror sets the amount at $300,000 for each occurrence.

The enrolled text of H.B. 2789, passed by the 89th Legislature, changes that figure to “$100,000 [$300,000] for each occurrence of negligence,” makes the same change for listed family homes, and says “Sections 3 and 4 of this Act take effect January 1, 2026” (H.B. 2789, enrolled). Whether the Governor signed it could not be confirmed for this guide, because the bill history and the commission’s guidance were unreachable. Ask Child Care Regulation which amount applies before buying a policy. Texas ratios sit in 26 TAC 746.1601, whose chart could not be retrieved, so none appear here.

Tutoring: no license found

No state license for tutoring or test prep centers turned up in the states researched. Two screening rules still reach tutors. In Florida, contractors “permitted access on school grounds when students are present, who have direct contact with students” must pass district screening, and that covers “any vendor, individual, or entity under contract with a school or the school board” (Fla. Stat. 1012.465). Google’s Tutor ads add business, owner and instructor checks. Check every tutor anyway; parents ask.

Zoning

Outside Florida’s home protection, the SBA’s warning applies: zoning can “restrict or entirely ban specific kinds of businesses” (SBA licenses and permits). The centers we have seen open also needed a certificate of occupancy, a fire inspection and, where meals are cooked, a health inspection.

Setting up the business

Entity and EIN. The SBA says an LLC protects owners from personal liability “in most instances” (SBA business structure). The IRS issues EINs at no charge, and it wants the LLC or corporation formed “through the secretary of state before you apply” (IRS EIN).

Insurance. Texas requires liability cover of license and registration holders, or a written notice to parents when it cannot be obtained, as above. Google’s ads require “General liability insurance” and “Professional liability insurance” for its Child care and Preschool categories and none for Tutor (Google requirements). The SBA lists property and the business owner’s policy beside them and notes “Laws requiring insurance vary by state” (SBA insurance). The programs we work with also carry abuse and molestation coverage, which many general liability forms leave out, and commercial auto if they drive children anywhere.

Workers’ compensation. California employers need it “even if they have only one employee” (California DWC). Florida’s rule outside construction starts at “four or more employees” (Fla. Stat. 440.02). “Texas doesn’t require most private employers to have workers’ compensation” (Texas Department of Insurance).

Tutors on a 1099. Tutoring centers often pay per session. The IRS warns that misclassifying a worker “with no reasonable basis” can make you “liable for employment taxes for that worker” (IRS). A tutor who teaches your curriculum on your schedule in your rooms is hard to call independent.

COPPA, if children log in. The children’s privacy rule covers sites and services “directed to children under 13” and treats identifiers such as “a cookie number, an IP address” as personal information (FTC six-step plan). The 2025 amendments require “separate verifiable parental consent” before sharing a child’s data for targeted advertising and allow data to be kept “only … for as long as reasonably necessary” (FTC). “The amended Rule is effective June 23, 2025,” and “regulated entities have until April 22, 2026 to comply” (Federal Register). A parent-facing website is not the issue; a student portal, a learning game or an online tutoring room for children under 13 is.

Space, food and software

Florida’s minimum standards list what an inspector looks at: “building conditions, indoor play space, outdoor play space, napping space, bathroom facilities, food preparation facilities, outdoor equipment, and indoor equipment” (402.305). In the build-outs we have seen, that means rooms sized by age, a fenced yard, child-height sinks, diaper stations away from food, and sight lines across each room.

Food can be reimbursed. USDA’s Child and Adult Care Food Program “provides reimbursements for nutritious meals and snacks” for children at “participating child care centers, day care homes,” and lists “public or private nonprofit child care centers … and other institutions which are licensed or approved” as eligible (USDA CACFP). The page does not set out how for-profit centers qualify, so ask your state agency.

Care software runs check-in, billing, parent messages and ratio tracking; before adding a child-facing app, reread the COPPA note above. Many tutors start in libraries or clients’ homes before leasing a small suite.

Pricing and money

Tuition for a given city, tutoring rates and startup costs are left out here, because no source we found states a method for them. The $13,184 national average describes the market, not your price. Budget from quotes against the SBA’s startup cost categories.

The ratios explain the price list. Under Florida’s rule an infant room earns tuition from four children per adult and a pre-K room from 20, so infant tuition runs highest everywhere we have looked, and a center heavy with infants needs it to. Most centers we see bill weekly or monthly by age room plus registration fees; tutoring sells sessions or packages timed to test dates.

Public money is revenue, not just competition:

CCDF. The Child Care and Development Fund is “a block grant to state, territory and Tribal governments” for “Children from birth through age 12 in vulnerable families” (ACF Office of Child Care). States run it, and their provider rules decide whether you can take subsidy families.
Texas Rising Star. Workforce boards pay subsidies “only to” providers “meeting the Texas Rising Star requirements as a certified provider, or designated as an Entry Level provider for the prescribed time periods” (40 TAC 809.91). A new Texas center that wants subsidy families plans for certification from the start.
Florida VPK. Every Florida child who turns 4 “on or before September 1” is eligible (Fla. Stat. 1002.53). A private provider’s school-year program “must comprise at least 540 instructional hours,” classes run from 4 to 20 students, and a provider “may not deliver the program while holding a probation-status license” (Fla. Stat. 1002.55). School Readiness, Florida’s subsidy program, adds standards such as “30 minutes of reading to children each day” (Fla. Stat. 1002.88).
California. CDSS oversees “the majority of state-supported child care and development programs” (CDSS Child Care and Development).

Hiring and safety

Who you hire. Childcare workers earned a median $16.82 an hour in 2025, and 39% of O*NET respondents said a high school diploma is required; for directors, 44% said a bachelor’s degree. O*NET lists Registered Apprenticeship titles for “Child Care Development Specialist,” “Early Childhood Educator” and “Early Childhood Education Operations Manager,” a way to grow your own staff toward Florida’s CDA requirement.

Screening timeline. Submit checks before hire and allow up to 45 days for results, plus Florida’s 40-hour course clock.

OSHA. Child day care (NAICS 6244) and other schools and instruction (6116, which holds tutoring) are on OSHA’s partially exempt list, so employers there need not keep injury and illness logs “unless they are asked in writing to do so.” Every employer still reports a death, an in-patient hospitalization, an amputation or a lost eye (eCFR, 29 CFR 1904).

Finding the first families

The state record. California’s public search shows “inspection results, licensing violations, and complaints,” but a 1984 law “prohibits the disclosure of small family child care home identifying information” (CDSS fact sheet), so a small home has to be found through its own channels.

Google Business Profile. A center showing its address “should maintain permanent fixed signage” there; a tutor who travels to students can use “one service-area Business Profile”; a virtual office is not eligible (Google guidelines). Our Google Business Profile service handles the setup for centers and tutors alike.

Local Services Ads. Google runs “Child care,” “Preschool” and “Tutor” categories, all with the Google Verified badge. Child care and Preschool ask for liability and professional insurance, a “Business license on state level*” and a “State level license/credential for each child care professional”; background checks are left to state licensing. Tutor asks for a “Business check,” “Owner check” and “Instructor check,” with no license or insurance. Screening takes “3-4 weeks” on average (Google requirements). Google defines Child care as “kindergarten through elementary,” so an infant and toddler program fits Preschool better.

Reviews. The FTC’s rule “went into effect on October 21, 2024,” bars incentives tied to reviews “expressing a particular sentiment,” and warns that asking only happy families “could violate the FTC Act” (FTC Q&A). Google forbids incentives “in exchange for posting any review” (Google policy), so a week of free care for a review breaks it. A review routine that asks every family after the first month does the job honestly.

Referrals and public programs. Becoming a VPK, School Readiness or Texas Rising Star provider puts you in front of families already using those programs. Nearby employers, pediatricians and churches sent the first families to the openings we have watched; for tutoring it was school counselors, and open houses held from January to March brought in more. The enrollment calendar is set out on our daycare and tutoring center marketing page.

What trips up new owners

Pricing rooms before staffing them. An infant room at 1:4 costs far more per child than a pre-K room at 1:20.
Opening the week checks clear. Federal law allows up to 45 days per background check, before the hire.
A Florida ad without the license number. It is a first-degree misdemeanor, flyers included.
Assuming the insurance figure. Texas law and the enrolled H.B. 2789 give different amounts; confirm which applies.
A kids’ app with ad pixels. Under amended COPPA, sharing a child’s data for ads needs separate parental consent.

Questions founders ask about starting a daycare, preschool or tutoring center

Do I need a license to watch children in my home?

Usually, once you pass a small number of unrelated children: Florida licenses care for more than five for pay and has homes register or license by county, Texas regulates family homes of up to six unrelated children, and California licenses small homes for up to 8.

How many children can one teacher supervise?

In Florida, four infants, six one-year-olds, 11 two-year-olds, 15 three-year-olds, 20 four-year-olds and 25 children five and older. California centers allow four infants or 12 preschoolers per teacher, or 15 with an aide.

What background checks do staff need?

State and FBI fingerprint checks plus sex offender and child abuse registries for every state lived in during the past five years, before hire and at least every five years, under federal law.

Does Texas require daycare liability insurance?

Yes, with one exception. Section 42.049 requires it of license and registration holders, or, where coverage cannot be obtained, a written notice to every parent that it is not provided. The statute as read sets $300,000 per occurrence; the enrolled H.B. 2789 would make it $100,000 from January 1, 2026, but its signature could not be confirmed here, so check with the commission.

Do I need a license to open a tutoring center?

No state license for tutoring was found in the states researched. Florida screens contractors who work with students on school grounds, and Google screens tutors before its ads run.

Can my center take subsidy or pre-K families?

Yes, if you meet the state’s provider rules, such as Texas Rising Star certification or Florida’s VPK and School Readiness standards.

Does COPPA apply to my daycare website?

Not to a site written for parents. It applies to apps, games and portals used by children under 13, and the amended rule’s compliance date was April 22, 2026.

Sources

Checked on October 3, 2026. Rules and fees change, and many are set state by state or city by city: confirm the current requirements with the agency that issues them before you apply.

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