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Spanish immersion childcare company Tierra Encantada secures $38 million investment

Minnesota’s child care industry is under pressure as providers struggle to fill job openings. A recent survey by the Minneapolis Fed and First Children’s Finance found there are more than 700 job openings, resulting in more than 2,000 child care spots unavailable statewide.

Other states and metropolises face similar challenges.

To fill that gap, Tierra Encantada, a growing Spanish-language child care company based in Eagan, plans to use fresh capital from a Pennsylvania investment firm to enhance its ability to offer early childhood education and options for families raising bilingual children in Minnesota and across the U.S.

To fuel nationwide expansion, Kristen Denzer, founder and CEO of Tierra Encantada, recently secured a $38 million growth capital investment from Pennsylvania-based Susquehanna Growth Equity (SGE).

“We are very excited about the partnership because they are very founder-focused. By bringing them on as a minority investor, we can increase both scale and quality,” said Denzer.

Tierra Encantada has locations in Minnesota, Illinois, Texas and Virginia. Of the 12 locations, two are franchises. Denzer said the company will have 16 locations by the end of the year, including an opening in Kansas. Two of the four new locations will be franchises.

“We are growing through both franchise and corporate growth,” Denzer said.

Denzer, who was named the 2022 Minnesota Small Business Owner of the Year by the Small Business Administration, said the capital will help Tierra Encantada invest in technology, training and innovation as it builds the company.

Tierra Encantada does not teach Spanish, but early childhood education classes are taught in Spanish. Tierra Encantada is open to children ages 6 weeks to 6 years. All locations offer international cuisine from a licensed commercial kitchen.

Founded in 2013, the investment is the first institutional capital secured by Tierra Encantada. Denzer declined to provide information on Tierra Encantada’s revenue.

“Tierra Encantada is the clear leader in Spanish as a second language early childhood education and we believe their differentiated model represents the future of child care,” said Kyle Squillario, SGE’s chief executive officer, in a statement.

The private equity firm is also investing in Minneapolis-based Field Nation, a platform that connects companies with IT engineers.