Britain’s investors are increasingly turning to toddlers to make more of their millions.

And one of Britain’s leading education pundits is behind a pound;30 million private nursery chain which aims to become the “Marks amp; Spencer of early years”.

Sir Christopher Ball, author of the 1994 Start Right report on the importance of the early-years experience, says he has been forced to turn to the private sector because the state sector has “sold out”.

The Jigsaw Group, of which Sir Christopher is now deputy chairman, has grown from the humble roots of a single nursery employing two staff to look after three children in February 1992, to 14 nurseries employing 400 staff, with 1,000 children on its books.

Sir Christopher said: “The private sector will put the state to shame, and a good thing too. I haven’t sold out - the state has. It offers equality (of access) in early years, but such low quality that children may as well not be getting a pre-school education at all. These business people are serious about quality and from within I’ll argue for equality; if we make a profit we can subsidise more places.”

The group will open 35 new nurseries nationwide following a pound;30 million management buy-out. The largest chunk of single investment, pound;7.5m, is from billion-pound venture capital group 3i, better known for its investments in multinational electronic companies worldwide.

Jigsaw chief executive Tom Shea said: “Some businesses are corner shops, we’re M amp; S. I know the idea of profit, care and education are anathema to some people, but if the money isn’t coming from government it’s got to come from investors.”

There is a growing interest from entrepreneurs and investors who increasingly see looking after the very young as the fastest way to make money. Derek Mapp, who sold his Tom Cobleigh chain of pubs to the Rank Organisation for pound;120m in 1996, is re-investing part of his fortune in Leapfrog, a new business which plans to open at least 60 nurseries over the next five years, offering 6,000 childcare places.

Mr Mapp expects to charge around pound;110 a week for each child, offering French and IT lessons, as “most four-year-olds have little difficulty managing a basic spreadsheet”.

Another of Britain’s wealthiest men, Duncan Bannatyne, who made a pound;46.3m fortune from nursing homes, is also due to unveil a new nursery business. Less surprisingly, Nord Anglia, the schools supply company founded by Kevin McNeany, already has a fast-growing nurseries division which it plans to expand.

Financial experts say nursery investment has grown because of the Government’s pledge to improve the country’s childcare. This is coupled with a growing realisation that an under-funded market is ripe for development.

Chris Williams, investment executive at 3i, believes he has made an “absolutely sound investment” in Jigsaw and sees the childcare business as having “very attractive” potential. “Childcare is a brand-new sector for investors with the benefit of being fairly low risk. It is probably the most topical growth market in business today,” he said.

However, Mr Shea, a former local authority early-years adviser, took a sideways swipe at his competitors with a warning not to leave the little ones out of the sums.

He said: “You’ve got to be child- led. Anyone going into this purely for profit will invariably go wrong. We’re a childcare company which happens to be commercial, not a commercial company which dabbled in pubs yesterday and just happens to be dabbling in children today.”