William Leonard
The second fastest-growing private company in America is based here in Atlanta, Georgia. Led by CEO Jeff Richards, SnapNurse is reshaping how medical staffing is facilitated through his healthcare staffing platform, which places nurses and facilities across the country within 48 hours. After working at Grady Hospital as the Director of Anesthesia, Jeff reunited with his former classmate from 19 years prior Cherie Kloss, where they put their heads together to build SnapNurse. At present day, SnapNurse has more than 350,000 nurses and healthcare providers on its platform and partners with more than 1000 medical facilities across the US. Jeff and I dive deeper in the podcast into some of the early challenges the business faced during its growth stage. How COVID served as a major tailwind in Jeff’s take on the state of the medical staffing industry today. This was a fun conversation. So let’s dive right in. Before we jump into today’s episode, be sure to remember that Valor is actively accepting entries for the Art of Inclusion Annual $5,000 Artists Commission. Please be sure to share this with a rising Georgia artist, whose work you appreciate. The deadline to apply is September 30th and you can find more information about this on our website valor.vc. And lastly, the final stop of the Atlanta Unlocked Tour is happening this Thursday at Atlanta Tech Park. Be sure to catch me and some of the other valor team members there. We look forward to seeing you. Now back to today’s episode. Jeff, how are you today?
Jeff Richards
Doing great, William. Thanks so much for having me on.
William Leonard
Of course, Jeff. I really want to kick it off here by saying congrats to you and the Snapnurse team for being on the Inc 5000 list. I think you all were the second fastest growing, private company in America. What does that mean to you, Jeff?
Jeff Richards
Well, it’s fun that we’re doing this podcast two days after that announcement, that’s a culmination of five years of tons of hard work. Obviously, in order to get to number two is a ton of rapid growth because it occurred over a five-year window and much of it occurred in the last two years. Of course, it was incredibly exciting. We were number one in healthcare services. Number two, any company, any vertical, any industry. When I walked out the door of Grady Hospital 19 years ago as a Director Of Anesthesia, yes, I wanted to take a chance. I wanted to better myself and what I thought was an idea that would disrupt an industry but I could have never imagined five years later, we’d be the second fastest growing company in America.
William Leonard
That is an amazing journey which we will certainly dive into here a bit more throughout our conversation. And, again, congrats to you and the team, but as we kind of kick off this episode here, Jeff, I would love for you to give us the brief sixty-second elevator pitch on what SnapNurse is, what you all are doing, and then we’d love to get some more context on your background. You have a really fascinating background as well.
Jeff Richards
For sure. Snapnurse is a tech-enabled nurse staffing agency. It started completely focused on nurses and then it’s grown to really include any clinical provider and even some of the nonclinical roles inside of the hospital. All of this, excluding physicians. This year, we’re in the early stages of adding physicians as well and they’ll probably go by Snap Locums. That’s the term for physicians that work in a contract capacity. The heart of it is that the technology is essentially an easy onboarding for a clinician to look at available jobs, some of which could include travel or local PRN, meaning one shift here, one shift there. A way to supplement their work or contracts where they might apply somewhere. It’s a platform that allows healthcare candidates to come in, see the available jobs, go through a matching process, and then be deployed out to the facility. Part of our value proposition to the clinicians is that we pay them instantly at the end of their shift. It has an Uber-like aspect to it that even as a healthcare provider, and as complex as that is, which it is, you’ve got to have, obviously, significant education licensure, certifications, and credentials associated with the acuity level of the clinician to match with the acuity level of the facility. After you’ve done all of that work, yes, you can be matched, pick up a shift, and then get paid instantly once that shift has been approved.
William Leonard
Wow, that’s fascinating. I think the Uber-like comparison is spot on, right? You’re giving this freedom to book and choose when you want to work and then the instant payout, which is I’m assuming a new innovation in this medical staffing space. I’m sure you have had no problems with it previously, which is why you’re hearing about this position now. We’ll talk more about that here. Tell us more about your background, Jeff. I know you’ve worked at Grady in other roles, operational roles. What’s your story?
Jeff Richards
I went to Emory, Masters in Anesthesia program that came out of that in 1998, and went to Grady Hospital. My partner and I, Cherie Kloss, kind of combined both of those because really, she founded the company, and then she found me 19 years later. But I went to school with Cherie Kloss and then we went our separate ways. For me, I went to Grady Hospital. I went to one facility for 19 years, might be kind of boring, but Grady is the largest public health teaching and trauma hospital in the southeast. It is nationally recognized for trauma burns and a variety of other procedures. It is high intensity. There is a rapid response nature and kind of an on-call element to working at Grady. It is one of the most difficult places to work in a healthcare environment because of the complexity of the cases that come through the door and its unexpected nature, and you’re constantly having to think on your feet, using every skill that you have, as well as just ingenuity, because sometimes things come in that are unexpected. I spent 19 years there and became the Chief Anesthetist then the Department Director for the last 10 years. Part of why I ended up in this position is that I have gone back to get an MBA in 2016 and in 2017, I was writing a paper on a mobile healthcare staffing app focused more on an academic exercise, looking at the Georgia State legislature at the time had commissioned a study that was forecasting, this was in 2007, they’ve done the study then, that was forecasting the peak of a nursing shortage and physician would begin to hit in 2017 10 years later. I’m in MBA school, I’m writing the paper, I’m in Grady, realizing that the bill rates are climbing, that the agencies weren’t adapting, they weren’t developing technology, that’s not their core competency. I realized there’s a huge opportunity here. There’s an old industry, it’s fragmented, it’s big, and it’s so manual, I would get blurry faxes even as late as 2017 about resumes of providers with no insight whatsoever that it was a level one trauma center. I would give them one criterion to only send me resumes of someone who’s given a unit of blood in the last six months. I would frequently get resumes of an anesthetist who has been in a GI center for the last three years. I wouldn’t even call them but they were wasting my time because there was no platform where I could go in, look at the candidates, and filter by the acuity that I needed. I didn’t want 50 or 100 candidates who are mostly unqualified, I just wanted three who were. They didn’t understand or didn’t do the pre-work, there was no software, but I kind of knew there was a huge opportunity. What I didn’t know is that my classmate from 19 years before had the same idea at the same time and had already built essentially an MVP, a prototype of proof of concept that you could create these filters to go out and have selectivity. She reached out to me out of the blue right after I wrote the paper, which is just like the story of Snapnurse filled with lightning bolt moments of impossible connections. She said, “Hey, do you want to help me with my startup?” I looked at it, understood what she had built so far, and became the first investor started the track to quit my job at Grady which I didn’t do right away. We went around Atlanta trying to get institutional money and we couldn’t get it. They said have you ever done this before? What’s your background in starting a company? We fully understand this industry inside and out. We’ll learn all the rest, but that wasn’t enough. So we turned to friends and family, all of who are healthcare providers for the most part, and who fully understood the problem as well and believed in me and believed in Cherie. We were able to raise $1.2 million in 30 days just from friends and family right here in Atlanta. Steak dinners in Buckhead with explaining it, pitching it, learning all that on the fly, and within a month after that, we got our first client. I submitted my resignation to Grady, walked out the door at the end of October 2017, and never looked back.
William Leonard
Wow. Congrats. That is an amazing story of being reunited with a classmate who you probably imagine you may not ever see again. Now, you all are business partners together launching a startup and having, I think you mentioned, you had no prior business startup experience, just operational wherewithal on the healthcare side. Wow. That’s awesome, Jeff. You mentioned that what you were seeing in the industry previously was extremely manual. You saw faxes being sent back and forth, manual resume reviews, and manual filtering of resumes, what else were some of the key drivers that helped you say, “Hey, there needs to be innovation in this medical staffing space now?”
Jeff Richards
When I was the Director of Anesthesia in Grady, I oversaw along with every other department in the hospital, the implementation of Epic electronic medical records. And so, at that time in 2010, we had paper charts and everyone thought, how are we going to get all of that? How’s it going to be accurate? But of course, documenting an electronic patient’s chart into an electronic medical record makes perfect sense. The lift that was required to do that was multiple, multiple months of preparation, training, implementation, and resistance, but even the most resistant older clinicians that I had in my department and I saw throughout the hospital, once they went through the transition, they realized the enormous value of storing all the patient records that we would have to carry in big bulky charts back and forth for trips to surgery back to the ICU and back again. Now, it’s all stored in the computer, you document in one location, you go back into the location, of course, and it’s stored in the cloud. It’s a transformational experience. I went through a massive technology disruption and transformation in that period and realized, one, for a host of reasons, this is partly the story of our opportunities that healthcare tends to run 10 to 15 years behind other industries when it comes to technology adoption. All of the money poured into innovation healthcare, much of it or almost all of it, is in new instrumentation and other innovations that provide new procedures, robotic surgery, and imaging, not in how to manage the workforce. That part is lagging well behind. Knowing that and then having seen an entire hospital go through massive digital transformation, that it can be done. When it came to managing the workforce, I knew there was a huge gap. I wrote the paper. What Cherie was building, realizing that two, there were other companies that had just started or were starting at that time. Competition is also validation that there’s something there. If no one else is doing what you’re doing, either you’re completely one of one or you’re leading the pack, but it’s healthy and validating that there’s a bunch of companies starting because they realize there’s a gap here. Yes, you’re gonna have competition, but the market is enormous, right? It’s a huge market for all the hospitals in the United States.
William Leonard
This is a tremendous market that’s bringing a lot of value as well. It sounds like now, these hospitals and facilities through Snapnurse don’t have to wait to fill staffing positions a long time, is that right? They’re able to shorten the time of a position being open.
Jeff Richards
Speed and quality. That’s the major transformational change. The process can be as little as 24 to 48 hours and the quality of the matching is dramatically better.
William Leonard
Now, facilities don’t have to wait long for help. And then also it sounds like nurses can choose, I guess, how fast they want to get paid. Also, choosing a job in a tech-driven environment instead of having to fill out paperwork applications. Now, you can interface through the Snapnurse app. It also sounds like this makes it easier for nurses who come from underserved backgrounds and underserved communities to now have access to more opportunities to make money but to also serve in various capacities in various regions as well.
Jeff Richards
That’s true. That’s part of the story of our company. We were founded here in Atlanta. There’s a huge African American nurse population in Atlanta and from my relationships and Cherie’s relationships, we attracted a ton of clinicians onto the platform early on. The balance, a large majority of our nurses and clinicians on the platform are African American, and that’s a combination of I think, being born in Atlanta and the relationships that we had to get started. It’s a complete equal opportunity. Anyone can come into the platform and be onboarded. It’s all about qualifications, right? Their degree, their certifications, and what acuity level they’ve practiced in. It becomes a giant matching engine that allows anyone to practice. It’s just that for us, we attracted and grown this enormous African American database of healthcare clinicians which has been great. It’s great to see because our success is their success. In many ways, they are Snapnurse. We’re just the machine behind helping the matches and deploy clinicians where they’re needed most.
William Leonard
Snapnurse was named the number two fastest-growing private company in the country. Talk to us more about the current state of Snapnurse today, how many nurses, and health care providers are you all helping empower through the technology you all have?
Jeff Richards
At this point, we have 350,000 nurses on the platform. Two and a half years ago, we had about 20,000. It just tells you what happened over the last few years. And at any given time, we’ve had as many as 6,000 nurses on assignment and that number fluctuates based on needs and demands. Over the last five years, we’ve had a total of a little over 25,000 nurses who worked for us at any given time in any given location. A lot of them, and we’re kind of going through this now, is identifying those top 5 to 10,000 nurses and generating an algorithm that both rewards them for loyalty to us and that being star performers, and creating a total rewards program, much like you’d see through an airline or any other, as we hard to believe we become a more mature organization even though we’re only five years old. We want to build in and recognize the status levels of clinicians not unlike the airlines where you might go from silver to gold medallion to platinum to diamond. Recognize them for what they’ve done, and what they’ve contributed, and reward them for that.
William Leonard
That’s tremendous growth. You said 20,000 nurses just over two years ago, now to over 350,000 on the platform. What were some of the tailwinds that served as an accelerant for Snapnurse? I’m sure COVID, obviously, has something to do with that with nurses needing to be distributed to various COVID hotspots, but talk to us more in-depth about the tailwinds that helped accelerate the business.
Jeff Richards
That’s a really interesting question. Of course, the pandemic created almost unlimited demand, right? There were more needs than there were nurses and it just became a giant matching and exercise in how much of that business could you possibly take. Clearly, in that environment, we just outperform everyone probably 10:1 because of the speed with which we were able to take the nurses in and then display the jobs to them, and then our internal service delivery of getting them onboarded and deployed. They would arrive in a new area where hospitals were constantly in crisis, land there, work the shifts, go to their hotel, get paid instantly, and have the capital they needed to get through like getting groceries and getting settled into a new location. There’s no question that the pandemic and because of the enormous need for nurses are needed everywhere, it came in waves. For us, it was like a war. The battlefield was in the hospitals and the nurses and clinicians were the soldiers. The different mutations of the virus became offensive, they were waves, and then there were peaks and valleys. There was a period to get recovery, which was very needed. There are just stretches between the nurses themselves that were being deployed and working almost always 60 hours a week. Internally in the company, two and a half years ago, we had about 20 employees. Today, we have about 430. We went through stretches where the demand was so enormous, everybody had to work seven days a week. There’s no way out of it. Anyone listening who worked at a hospital will know that because our clients were also working seven days a week and they couldn’t turn it off either. It propelled our company. We showed that we could do it better than anyone else and we embraced that, too. We never said no to any order that came at us, other than when we ran into challenges where our credit limits had to be increased three different times in a very short period of time, which also, no one had ever seen anything like that. We had to keep increasing the credit limit over and over in order to take the business because we were paying interest instantly. And then we would get paid for 30 to 90 days by the clients.
William Leonard
That’s another thing that you think about when you look at a hyper-growth startup. Those types of problems are going to arise. How did you all have to basically circumnavigate that and what are some of the other challenges that arose over just facing such rapid growth in a short period of time?
Jeff Richards
I think I’ll take it in maybe two buckets. It’s the HR side. Even two years ago, we had no formal HR department, just myself and my partner. We were in the early days of 2020, we went from 20 to maybe 50 employees, and we were still doing all the hiring ourselves. The HR side of it is that that period of time was like an operational hurricane. Orders would come in, we needed 20 nurses then we needed 100. The first time we got an order for 100, we just couldn’t believe it and everybody just worked around the clock. We filled the order. We were just so satisfied and then the next order came and it was 400. Again, we had to hire rapidly. We would hire and it became like self-selection. There are people who came in and were so energized by this company that was growing in real-time right in front of them. They were part of the mission, sending desperately needed nurses to locations where they were offering life-saving care is very meaningful work. It’s one thing to work 60-70 hours a week and don’t have that return of emotion and passion about what you’re doing, but there were definitely individuals who came in and just energized even with the amount of work that you had to do to execute all that. And then others, we had people that worked for one day and said this is crazy. It’s chaotic and it’s not organized. Well, it’s a startup. You’re gonna have to be a self-starter. You have to do a lot of stuff on your own. HR became its own challenge, attracting the people going through and asking them where they had to be part of something where work hours were just crazy. The other is the financial part of that, which we touched on a little bit but by growing that fast, we got into these cash balance situations where we had first tens of millions of dollars we had to borrow to make payroll, then that became hundreds of millions. That cycle had its multiple moments of extreme stress, wondering where we going to get the lending we needed. Sometimes wires hit minutes before payroll. It’s just any company that’s growing goes through these challenges, it’s just that we went through twenty years of business development in two years, and got to a height where they want to see a history of revenue. Well, this revenue is only, at the time, six months old or it’s a year old. They’re like, well, that’s not enough. But look what’s happening, you can participate in this. There were a lot of tends to negotiations around getting the credit limits increased. Today, we’re with Wells Fargo. We couldn’t be happier but it took us two years to get to an institutional level bank like that on good terms. That was another huge challenge.
William Leonard
I can imagine. You mentioned you did twenty years’ worth of business development in two years, right? And as the leader, basically, you were saying you and Cherie were the HR team, I’m sure it was a delicate balance of hiring the right people, but also hiring at the right pace, because things are moving so fast. How did you all manage to basically do that? Because I know it’s probably incredibly difficult because you need bodies, you need people to be doing the work, but it has to be the right people doing the work.
Jeff Richards
I kind of touched on it before but Cherie and I were acting as HR until a little under two years ago. We have a phenomenal HR team now but we were also absolutely operators. We were still selling contracts. Two and a half years ago, we did add an amazing Head of Business Development named John Spears. He’s still with us today. He was instrumental in a lot of our growth and in selling some of these larger contracts but we were doing a little of everything. Number two, as I said, there were times when we would put out ads and during the pandemic, there were portions of the economy, as you well know, there were layoffs. We had access to talented people and what’s also interesting is that in Atlanta, most of our office would come into work with us. We had to do all of that hiring during the pandemic and everybody was remote. Now, we have employees scattered all over the country who are all remote workers. We still have a core in our headquarters, obviously here in Atlanta in Colony Square, but it was a process of trial and error. Can’t give you more than that other than we knew the recruiters needed a certain skill set but we had to do it so quickly that sometimes we were hiring, the hospitality industry was devastated, so we hired waiters, sous chefs, bartenders, which I worked as a waiter for myself for 10 years. The last restaurant job I had was at Buckhead Diner and then went to anesthesia school which worked great. The work ethic of the hospitality industry is very well suited to staffing. They have a huge learning curve when it comes to health care but they were very good about learning on the fly. They had a phenomenal work ethic and a lot of them did really well.
William Leonard
I love that. You took somebody from an adjacent industry, just a different vertical, and thrown to the wolves and said, “Hey, there’s a healthcare learning curve but I know your background. I know what you’ve been through. You can learn it, let’s work.” I love that.
Jeff Richards
A lot of it is the trust in the software. We built the software that had the filters and their job was primarily customer service, right? If the nurses onboarding, nearly mostly on their own, which is how we designed it as a self-service platform, they’re doing a lot of the heavy lifting. And then at some point, you’re going to be talking to one of our recruiters or the credentialing team who are gathering documents, and you’re booking flights and deploying them making sure that they understand the first day instructions and things like that. Getting them like a concierge, it’s almost like their title, where the software is ensuring that quality, filtering, and acuity level are matched appropriately.
William Leonard
Jeff, I think you’re the perfect person to answer this question here. You’ve been in this space for over 20 years now. We’d love to get your viewpoint and your take on the state of the medical staffing industry. How are software solutions like Snapnurse driving growth and innovation in this space? I’m wondering, do you have any bold predictions as to where this space will be over the next 5, 10, 15 years or so?
Jeff Richards
I don’t know. Even three years from now, it’s not going to look like it does today. It will be technology forward and partnerships with companies like Snapnurse that have built a platform that can facilitate the onboarding and the movement. The pandemic was very hard on everyone, particularly everyone in healthcare and particularly nurses because they were at the bedside. But it did mobilize a lot of clinicians who wanted more choice and flexibility. They didn’t want to work mandatory overtime but we’ve got to partner with the facilities and of course, with the nurses, and have a platform that facilitates ease of movement, choice, and flexibility for the nurses. The clients are going to need a workforce. We’ve got to work together. At this point, the industry is more transactional on the whole. It’s a client-vendor relationship, but that can’t be the future. It’s not sustainable, financially or otherwise. Software now exists that can facilitate the movement, whether that’s managing an internal float pool, and then supplementing with external staff as needed. That can be done right now. The interest in appetite because the facilities are so frustrated is higher than ever, that there could be a follow-on wave of innovation after the pandemic. That’s what we see that this isn’t the time to go back to business as usual. This is the time to press forward and implement a totally different way of doing supplemental internal and external staffing right now. Don’t wait any longer. You can’t keep going back to the old way. It’s not sustainable. I think within three years, it’s going to look dramatically different and there are companies like ours that will lead the way.
William Leonard
I love that perspective. You can’t revert back to old ways just because we’re seemingly getting back to normal here. I think that is applicable to a multitude of industries, including healthcare, supply chain, and other industries that have been truly impacted by the pandemic. That’s a spot-on viewpoint there, Jeff. I really appreciate you coming on today and talking more about the early origins of the business. What a fascinating story of reuniting with an old classmate 19 years later to now building the second fastest growing company in America. That is amazing. I’m excited for you all, Jeff, and I’m glad it’s an Atlanta story as well. What does the city of Atlanta mean to you and the Snapnurse team?
Jeff Richards
This is where we were born. It’s everything. It’s what we know. I spent 20 years at Grady. Grady is tied to Atlanta. I’m very proud of the company, but proud that it was born here in Atlanta, and it’s good for the city, right? It’s good that the recognition that there’s an entrepreneurial spirit here and there are multiple other companies that are on that Inc 5000 list here that have had also successful trajectories over the last few years. But I think in many ways, it feels like Atlanta is becoming a major entrepreneurial hub which is exciting for all of us. It’s good for the city.
William Leonard
Definitely. I agree. Well, Jeff, this has been such an insightful and fun conversation to have with you. Snapnurse is a rapidly growing company. Glad that you all are doing it here and glad that you all are impacting one of the most important segments of our economy today. Jeff, with that, grateful to have you on and look forward to watching you lead Snapnurse to greater heights
Jeff Richards
William, thanks for having me on. It’s a pleasure.
William Leonard
Likewise. Take care, Jeff.
Lisa Calhoun
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