Avathon Capital Acquires Yellow Brick Road, Strengthening Commitment to Early Childhood Education

Leveraging its early childhood expertise, Avathon invests in Yellow Brick Road, a founder-owned, center-based platform in the Midwest

CHICAGO and MINNEAPOLIS, Feb. 6, 2025 /PRNewswire/ -- Avathon Capital ("Avathon"), a private equity firm specialized in investing in lower middle-market companies in the education and workforce markets, announced its acquisition of Yellow Brick Road Early Childhood Development Center ("Yellow Brick Road"), a network of early childhood education centers serving families across Minnesota, Nebraska, and Iowa. This acquisition marks Avathon's third investment in the early childhood education sector, reinforcing the firm's commitment to fostering growth and innovation in this critical space.

Founded in 2006 as a single-center business, Yellow Brick Road has grown into a trusted provider of high-quality, education-based programs for children ranging from infants to school-age. Today, it serves thousands of families across its 25 centers, delivering a safe and nurturing environment that supports children's individual development and learning needs.

The addition of Yellow Brick Road to Avathon's portfolio builds on the firm's successful early childhood education strategy, which began with Big Blue Marble Academy (sold in 2024) in the Southeast and has continued with the Magical Beginnings platform serving communities in the Northeast. With Yellow Brick Road, Avathon expands its reach and deepens its commitment to partnering with organizations that share its vision of empowering educators, supporting families, and creating exceptional early learning experiences.

"We approached this transaction with a clear understanding of what it takes to support businesses in the early childhood education sector and a deep appreciation for the values and vision that make Yellow Brick Road unique," said Shawn Domanic, Principal at Avathon Capital. "By fostering a strong partnership and bringing our expertise to the table, we are focused on helping Yellow Brick Road enhance its operations, enrich its curriculum, and elevate the overall experience for educators and the children and families it serves."

Avathon is partnering with industry veteran Jessica Johnsen, who will continue to lead Yellow Brick Road as CEO. Over the past five years, Jessica has guided the organization through significant growth, strengthening its reputation for delivering exceptional care and education.

"We are so excited to be partnering with Avathon as we enter into the next stage of our business growth. We met Avathon years ago and through our continued conversations, it became clear that they would be the perfect fit to help us serve more families, educate more children, and carry out our mission of putting more good humans into the world as we leave it better than we found it. We are thrilled to have a partner who is passionate about early childhood education and aligns so well with our values and purpose."

"Early childhood education is an incredibly important sector in our country and has been a core area of investment focus for Avathon," said Jason Rosenberg, Managing Partner at Avathon Capital. "We are dedicated to providing capital, strategic support, and our experience to high-quality operators in the space. We could not be more excited to partner with Jessica and her talented team at Yellow Brick Road to build on the strong foundation they've created."

To support Jessica and the continued growth of Yellow Brick Road, Avathon has formed an experienced board of directors, which will be chaired by Dan Sommer, an education leader with extensive experience in building and scaling education businesses. Sarah Clabby, a seasoned executive in early childhood education and current Chair of Magical Beginnings, is also joining the board as a director. These leaders will provide guidance and support as Yellow Brick Road strengthens its operations and broadens its reach.

This partnership marks Avathon's fifteenth platform investment. BakerHostetler served as Avathon's legal advisor on the Yellow Brick Road transaction.

About Avathon Capital: Avathon Capital is a private equity firm specialized in investing in lower middle-market companies in the education and workforce markets. Avathon's sector specialization creates compounding advantages—enabling the Firm to deeply understand its markets, identify opportunities early, and build an extensive network of industry leaders and seasoned executives. With its research-first, executive-first approach, Avathon brings decades of experience and a partnership-driven mindset to every investment, engaging with conviction and working collaboratively to drive meaningful growth. Recognized by Inc. as a Top Founder-Friendly Private Equity Firm, Avathon is committed to building enduring companies that shape the future of education and workforce. For more information visit: www.avathoncapital.com.

About Yellow Brick Road: Yellow Brick Road is a network of early childhood education schools across Minnesota, Iowa, and Nebraska. The organization provides high-quality, education-based programs for children ranging primarily from infant through pre-K, creating a strong foundation for success in kindergarten and beyond. Yellow Brick Road endeavors to "put good humans into the world and leave it better than we found it." For more information visit:  https://ybrecdc.org/.

Media Contact: Grace Glick, [email protected] 

SOURCE Avathon Capital