--- title: "Children's Lighthouse Lease Program: Lowering the Cost of Entry into Franchising" url: https://burnaze.com/article/a3189e6d-81c9-4b37-a5cf-e7cc00c3ae6d source: "1851 Franchise" original_url: https://1851franchise.com/childrens-lighthouse/how-the-lease-program-lowers-the-cost-of-entry-into-becoming-a-childrens-lighthouse-franchisee-2728540 category: "Childcare & early learning" industry: "Education & Childcare" segment: "Childcare & early learning" published: 2025-02-11T18:13:37.000Z modified: 2026-10-31T17:19:15.155Z image: https://newimage.1851franchise.com/cdn-cgi/image/quality=85,format=webp,width=1280,height=720/story/featureImage/0c72e421207492f62d0e753a5531dd9a5911.jpg --- # Children's Lighthouse Lease Program: Lowering the Cost of Entry into Franchising **TL;DR:** Children's Lighthouse introduced a Lease Program to lower the upfront cost of opening a new location, reducing the required investment from over $7 million to approximately $1.4 million. The program allows franchisees to start with a lower financial commitment and later buy the building and land if they choose. *originally published in 1851 Franchise on 2025-02-11. [Read the original](https://1851franchise.com/childrens-lighthouse/how-the-lease-program-lowers-the-cost-of-entry-into-becoming-a-childrens-lighthouse-franchisee-2728540).* ## Story Investing in a Children’s Lighthouse franchise is an exciting opportunity to build a business that makes a meaningful impact on families and communities. However, the traditional path to ownership — buying land and constructing a school — has historically required a multi-million dollar investment. To make franchising more accessible, Children’s Lighthouse introduced the Lease Program, a game-changing option that significantly lowers the upfront cost of opening a new location. “Historically, owning a Children’s Lighthouse meant a total investment of over $7 million, with franchisees needing to inject at least $1 million to $1.2 million in cash,” said Matt Kelton, vice president of franchise development at Children’s Lighthouse. “While that investment structure allows franchisees to build long-term equity through real estate ownership, it also created a high barrier to entry.” The Lease Program removes this significant financial obstacle. Instead of franchisees purchasing land and constructing a school, a third-party investment group — working with the Woodmont Company — buys the land and builds the facility according to Children’s Lighthouse specifications. The franchisee is then responsible for the interior build-out and playgrounds, reducing the required investment to approximately $1.4 million. “This option makes opening a school one-third of the cost compared to traditional ownership,” Kelton said. “It’s a big shift that allows more entrepreneurs, especially younger franchisees or those looking to scale faster, to enter the system.” For franchisees who want to own multiple locations, the lease model offers a significant advantage. “With a traditional investment, if you have $6 million to spend, you’re looking at opening one school. With the Lease Program, you could open three for that same amount,” Kelton said. “Rather than tying up their capital in real estate, franchisees can use their funds to expand and operate more locations.” This structure enables franchisees to grow faster and serve more families, helping them scale their businesses more efficiently while maintaining operational flexibility. Although the Lease Program allows franchisees to start with a lower financial commitment, it doesn’t prevent them from eventually owning their school. “There is a first right of purchase built into the agreement,” Kelton said. “The investment group doesn’t want to be a long-term landlord — they’re looking to sell eventually. That means franchisees who start with a lease can later buy the building and land if they choose.” This flexibility provides an excellent long-term investment strategy, allowing franchisees to enter the system with lower costs and later build equity when they are financially ready. Another benefit of the Lease Program is the reduced financial burden in the first 12 months. “When you’re developing a new project, unexpected costs can come up, and you’re the one writing that check,” Kelton said. “With this model, you put $75,000 down when you buy the franchise, and your financial commitment is minimal until the school opens.” Additionally, franchisees only pay half the lease cost for the first year, further easing early-stage expenses. “This structure allows franchisees to focus on building enrollment and ensuring strong operations before taking on the full financial load,” Kelton said. Children’s Lighthouse has seen tremendous demand for its educational childcare services, and the Lease Program plays a key role in helping the brand expand into more communities faster. “We saw half of our franchise sales last year come through the lease model,” Kelton said. “Many of our competitors have grown through similar programs. This gives us a powerful way to lower the cost barrier, get more franchisees into the system and ultimately help more children and families.” By lowering the initial investment, offering a scalable path for multi-unit growth and providing an option to purchase later, the Lease Program represents a win-win for franchisees and Children’s Lighthouse at large. “There’s huge demand for high-quality early childhood education,” Kelton said. “If we can make it more affordable for franchisees to get started and help them scale up faster, that’s a win for everyone.” ## Entities - 1851 Franchise (publication) - franchise expansion (topic) - Education (sector) - franchise investment (topic) - Children's Lighthouse (company) - Matt Kelton (person) - childcare services (topic) - multi-unit growth (topic) - lease program (topic) - The Woodmont Company (company) --- Originally reported by 1851 Franchise (https://1851franchise.com/childrens-lighthouse/how-the-lease-program-lowers-the-cost-of-entry-into-becoming-a-childrens-lighthouse-franchisee-2728540). Summarized by Burnaze (https://burnaze.com/article/a3189e6d-81c9-4b37-a5cf-e7cc00c3ae6d).