Kiddie Academy Franchise Cost, Revenue & Review 2026
Analysis by FranchiseVerdict Research · Methodology
FranchiseVerdict summary · 2026
A Kiddie Academy franchise requires a total initial investment of $590K – $1.0M, including a $150K franchise fee and an ongoing 7.0% royalty[2]. Per the latest FDD, average unit revenue was $2.2M[2]. SBA 7(a) loans show a 7.0% charge-off rate across 398 loans[1]. FranchiseVerdict grade: A (Strongest tier), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified
Overview
- Investment
- $590K – $1.0M
- 67th pct Education
- Avg gross sales
- $2.2M
- Outlet subset29th pct Education
- Royalty
- 7.0%
- 18th pct Education
- Units
- 364
- 77th pct Education
- SBA charge-off
- 7.0%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Education · color = vs category peers
Green = favorable by >10% vs Education avg · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- COSTTotal investment $590K – $1.0M including a $150K franchise fee, 7.0% ongoing royalty.
- RETURNSAverage unit revenue of $2.2M/year (median $2.1M) (reported for a subset of outlets rather than the whole system), with an estimated 37% cash-on-cash return (based on Gross Profit). Note: this is gross profit, not take-home income.
- RISKVerdict A (Strongest tier), verdict score 74/100 (higher is better). SBA loan charge-off rate of 7.0% across 398 loans (near or below the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Kiddie Academy Domestic Franchising, LLC
- Parent company
- EBI Holdings, LLC (KKR)
- HQ
- 3415 Box Hill Corporate Center Drive, Abingdon, Maryland 21009
Overview
About
Early childhood education and child care franchise (KADF)
- Headquarters
- Maryland
Can you afford it, and what does the money buy?
Entry cost runs 21% above the typical education franchise.
Source: FDD · Items 5–7
FDD Item 7
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $150K | $150K |
| Working capital (3–6 mo) | $65K | $130K |
| Equipment, build-out, other | $375K | $730K |
| Total initial investment | $590K | $1.0M |
Source: Kiddie Academy FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $590K – $1.0M
- Middle of category vs category
- Liquid capital req'd
- $65K – $130K
- Middle of category vs category
- Franchise fee
- $150K – $150K
- Bottom third — review vs category
- Royalty
- 7.0%
- percentage · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Payback period
- 2.7 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 7.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Transfer fee | $50K |
What do units actually make?
Average unit sales run 166% above the education norm.
Reported for a subset of outlets rather than the whole system
Source: FDD · Item 19
Single-unit · not modelled
Returns at a glance
An FDD discloses gross sales, not profit, and the operating costs that turn one into the other are in no filing. We publish no modelled return for Kiddie Academy until someone supplies them — yours, in the models below.
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Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
Total invested capital · disclosed
$898K
Item 7 initial investment plus working capital, as filed — the one figure here that needs no assumption.
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
FDD-reported earnings
The FDD reports $534K as Gross Profit. This is a disclosed figure, not our estimate — we publish no modelled profit for Kiddie Academy.
What one unit earns on your invested capital
Model A · Single-Unit Return
Computes unlevered return on invested capital (ROIC) for a single franchise unit, read against the 30–60% reference band · Yale SOM, Post-MBA Path Exhibit 2 (2023). Below that band a passive index fund likely outperforms; above it the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses, and it is the top line only — gross sales are not profit. No FDD discloses the operating costs that turn one into the other, so those fields start empty and nothing is modelled until you supply them from your own lease quote, labor market and build-out budget.
Returns model · single-unit ROIC
What would one Kiddie Academy unit return on the cash you put in?
Illustrative category typicals — not sourced to any filing, survey or sample. Replace them with figures from franchisee validation calls before you rely on the output.
Unlevered ROIC · per unit
Your modelled return on total invested capital, before any debt financing.
—
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
What 25 units return when you use SBA financing
Model B · Return on Equity: Debt-Financed Acquisition
Models a 25-unit portfolio acquisition financed with an SBA 7(a) loan. Shows equity IRR (your return on cash invested), DSCR (how safely the cash flow covers debt service), and the capital stack (SBA + seller + equity breakdown).
This is the “search fund” or “entrepreneurship through acquisition” scenario: you buy an existing multi-unit operator, use leverage to amplify returns, and either operate or hire management. The 25-unit size is the typical minimum for an SBA-backed franchise portfolio acquisition to pencil as a full-time income.
What “return on equity” means here: if you put in $500K of your own cash and the business generates enough EBITDA to pay down debt and grow, your equity IRR is the annual return on that $500K, including the value created when you eventually sell. Target IRR for a search fund is typically 25–35%.
Not modelled yet
An FDD discloses gross sales, not profit. We hold no sourced figure for COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
A 25-unit return is built on a per-unit EBITDA. Fill in the operating costs in Model A above and this model runs on that figure, or take the whole scenario to the full ROI workbench, where the portfolio and LBO models accept your own per-unit economics directly.
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Financial Performance
Reported for a subset of outlets rather than the whole system
- Avg gross sales
- $2.2M
- Per unit, per year
- Median gross sales
- $2.1M
- Avg gross profit
- $534K
- Reported as Gross Profit in FDD Item 19
- Cash-on-cash
- 36.7%
- Based on Gross Profit / investment midpoint
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- historical actual
- Sample size
- 315 outlets
- vs category median 17 · large
- Quartile band
- $1.4M→$3.2M
- Bottom 25% → top 25%
- Reporting year
- 2025
- Fiscal year the figures cover
Compared against 204 Education brands
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Unit economics
Average unit generates $2.2M/year in gross sales. Revenue-to-investment ratio: 2.7x. Reported for a subset of outlets rather than the whole system.
Fee burden
7.0% royalty + 2.0% ad fund.
Operator retention
System expanding at 11.3% CAGR over 3 years across 364 units — operators are staying and new ones are joining.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Education averages
How Kiddie Academy Compares
Is the system healthy?
Source: FDD · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 364
- Opened
- 23
- Last reporting year
- Closed
- 3
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 1
- Term expired, not renewed (per Item 20)
- Turnover rate
- 1.1%
- Company-owned
- 1
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (3-yr)
- +11.3%
- Net unit change over 3 years
- 3-yr CAGR
- +11.3%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 23
- Closed (3yr)
- 3
- Terminated (3yr)
- 0
- Non-renewed (3yr)
- 1
- Transfers (3yr)
- 18
- Reacquired (3yr)
- 0
- Franchisor bought back
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 398
- Loan volume
- $546.6M
- Median loan
- $637K
- 50th percentile
- Charge-off rate
- 7.0%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 93.0%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 85
- Defaults
- 16
- Typical loan rate
- 6.4%
- avg rate to borrowers
- vs industry
- N/A
- NAICS 6244
- Jobs supported
- 10,067
- 1.8 per loan
- Lender concentration
- 8%
- top lender's share
Borrower mix: 0% went to startups / new businesses, 100% to established operators
Vintage analysis
Kiddie Academy charge-off rate by loan vintage
Top lenders financing Kiddie Academy franchisees
Showing 3 of 85 lenders. The full breakdown — every lender, state distribution, interest rates & risk ratings — is in the SBA Lending Report below.
Explore lender portfolios on Bank Reports or regional data on State Reports.
What could kill this investment?
SBA loans charge off at 7.0% — 56% below the 16.0% national norm, i.e. lower lender-observed risk.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
Litigation (Item 3)
Kiddie Academy has been party to franchise-relationship disputes: uncured defaults/relocation dispute (Radoste, settled 2017); trademark/copyright infringement after termination (Sumanth/Wonder World Learning, settled 2021); post-termination trademark dispute (Sierra Learning Academy, settled 2019, franchisee allowed transfer + partial refund); pending 2024 suit against former franchisee (Paradise Organization Corp.) for copyright infringement, breach of contract/guaranty, and trade secrets violations after removal of marks post-termination.
Bankruptcy (Item 4)
None disclosed
What are you signing up for?
Ongoing fees run about 9.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 15 years |
|---|---|
| Renewal term | 10 years |
| Territory type | protected |
| Protected territory | Yes |
| Exclusive territoryℹ | Yes |
| Territory radius | 1 mi |
| Territory population | 50,000 |
| Franchisor can compete | Yes |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 20 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | No |
| Governing law | Maryland |
| Litigation count | 4 |
View Item 3 litigation summary
Kiddie Academy has been party to franchise-relationship disputes: uncured defaults/relocation dispute (Radoste, settled 2017); trademark/copyright infringement after termination (Sumanth/Wonder World Learning, settled 2021); post-termination trademark dispute (Sierra Learning Academy, settled 2019, franchisee allowed transfer + partial refund); pending 2024 suit against former franchisee (Paradise Organization Corp.) for copyright infringement, breach of contract/guaranty, and trade secrets violations after removal of marks post-termination.
Items 10, 11
Training & Operations
- Classroom training
- 96 hrs
- On-the-job training
- 32 hrs
- Training location
- Abingdon, Maryland (corporate office/Academy) plus online/virtual
- Ongoing training
- Required
- Site selection
- franchisee with franchisor review/acceptance
- Franchisor financing
- Not offered
- Item 10
Items 5 & 11
Franchisor Support
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Kiddie Academy franchise?
The total investment to open a Kiddie Academy franchise ranges from $590K – $1.0M, with an initial franchise fee of $150K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Kiddie Academy franchise owners earn?
According to Item 19 of the Kiddie Academy FDD, the average gross sales per unit is $2.2M. The median is $2.1M. Important context: Reported for a subset of outlets rather than the whole system. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the Kiddie Academy FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the Kiddie Academy FDD and qualifies whose outlets they describe.
What is Kiddie Academy's franchise failure rate?
Based on SBA 7(a) loan data, Kiddie Academy has a charge-off rate of 7.0% across 398 loans, meaning 7.0% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many Kiddie Academy franchise locations are there?
As of their most recent FDD filing, Kiddie Academy has 364 total units in the United States, including 363 franchised units and 1 company-owned units. 23 new units were opened in the latest reporting year.
Is Kiddie Academy a good franchise to buy?
FranchiseVerdict rates Kiddie Academy as a A-grade franchise with a verdict score of 74 out of 100 (higher is better), based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
For franchisors
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.