AGB 2020.5 - Bright Horizons (BFAM)

Employer Sponsorships Drive Future Returns

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Bright Horizons Family Solutions

Bright Horizons is the largest employer sponsored provider of child care in the U.S. by a factor of 6x versus the next largest competitor. The company also operates centers in the U.K. and Netherlands. Bright Horizons has ancillary employer sponsored services such as (1) back-up care services in its centers and in homes, which has done well during the recent government mandated shutdowns and (2) education advisory services to the employees and relatives of the employer sponsors, which is mainly comprised of tuition assistance and college coaching.

Bright Horizons provides services that are part of an employer’s benefits package to its employees, some of which is tax advantaged for the employer. Its center-based care business is 2/3 employer sponsored and 1/3 supported by a consortium of sponsors around a location. The better part of the business is the employer sponsored centers because …