SnapNurse Is the Uber of Nursing: It's Medical Staffing, Reimagined

She was emancipated from her family when she was fifteen years old. She had to leave the home to get help for her mother. Her parents parted ways. Her father decided he needed to go back to Korea to find a job. Cherie, who was on the Venice High School swim team, refused to go with him.

She was told by her father that she was on her own.

She said okay. "I won't be with anyone."

She was told by her father that she could make it in this country if she worked hard and studied hard. She would have to fight for herself, but her father had faith in the American dream.

Kloss was able to wing it. She moved in with a friend, got a full-time job at a bakery, finished school, and got a scholarship to a small Christian liberal arts college. She says college felt like summer camp when she was a child. After graduating from college, I went to nursing school and worked as an anesthesiologist for 10 years.

Her formative years resulted in a restless instinct to not get used to it. She says that anesthesia is similar to flying a plane--hours and hours of boredom but also some excitement. When Kloss met a producer for A&E Networks, she decided that it was more fun than reality TV. She asked how she got started.

Is there any experience you have?

She said she would do whatever it took. Kloss began looking for colorful characters in the American South after the producer agreed to be her mentor. She sold 38 shows about everything from Kentucky backyard oil prospectors to Alabama gold miners and watched eight of them.

She kept her anesthesia work as a side hustle and filled shifts whenever someone needed her. She says that she had to bring her paper credentials with her when she was working at 11 different places. I wanted to be on an app so I could easily find jobs and they could easily book me.

The golden age of reality TV was over by that time. I figured there wasn't any reason not to try a tech business since I had done well in the TV business. She began taking online courses because she was an expert at making things work with a MacGyver-like talent. She was a single mother with two children and two jobs. She wondered what the worst thing that could happen would be. Is it possible to go back to analgesia?

When her new company launched as a digital marketplace for connecting contract nurses and health care institutions, she didn't know what was going to happen.

It's the thing about a global pandemic that no one had anticipated: With vast chaos comes not only vast opportunity, but also occasions to fundamentally change whole systems. There were pockets of demand for nurses that needed to be filled on a moment's notice. Unlike many companies that saw a surge in revenue only to see it fade quickly, SnapNurse responded to the moment by establishing itself as a new fixture in the health care world.

There was a rise in the number of patients waiting for deferred elective procedures. The phenomenon of resignations among exhausted health care workers is still going on today. According to a survey, more than 30 percent of current nurses plan to leave this year. One in five health care workers quit during the height of the swine flu, according to a survey.

A variety of factors have resulted in a persistent undersupply of nurses in rural areas. Per diem nurses who take short-term contracts to fill gaps have risen in popularity.

From the beginning of the year to the end of the year, the company grew by 150,000 percent. That isn't a mistake. Most of the growth took place in two years. Revenue increased from $3 million to $88 million. It had hit over $1 billion by the year 2020.

Dion Deloof, the company's first institutional investor, whose venture capital fund Alpha Impact 8 has contributed more than $3 million to snapNurse over several rounds, struggles to put those growth figures in perspective. He says that there aren't many companies that do it and that you don't see what he calls a tech-enabled professional services company grow like this. I can't think of a similar thing.

How did that happen? Kloss had 10 years of experience on the staff side and another 10 on the temp side, but she had no idea what she was going to do after TV. She reached out to Jeff Richards, who was the director of anesthesia at Atlanta's Grady Hospital, because he was frustrated with the hassles of staffing his department. Richards didn't have a way to quickly review, rank, and select qualified people. I had multiple staffing agencies call me with résumés that were not in line with the trauma center I was working at.

Richards was thinking about his next move when Kloss reached out and offered him a look at her prototype. He wrote a paper as part of his studies. He couldn't help but think he needed to join her after she began talking about a proof of concept. They were aware of the issues from the administrators' perspective. Richards and Kloss were both operators. They hit the road looking for more money after Richards sunk $100,000 of his own money into the company.

It was difficult. Even though Kloss and Richards knew the field, they weren't experienced entrepreneurs and were turned down by every other institutional investor. The founder of a company in the recruiting and HR tech space understood how fragmented and manual the staffing agency world was. Traditional tech founders wouldn't be drawn to the space. He says it's better to build another platform than a tech-enabled professional services process. That sounds like a lot of work.

The biggest break may have been the hiring of an interim CTO by the company. The technology behind Intercontinental Exchange, the powerful Atlanta company that acquired and operates the New York Stock Exchange, was built by a former client and friend of De loof. The hiring of the guy who built one of the world's fastest trading systems proved to be critical, as the infrastructure he and his team created for SnapNurse was highly flexible andScalable.

Modeling the software on that of gig economy companies made it easy for nurses to find jobs and for managers to find nurses. There is a connection between attendance- tracking and payment. Logistical details gotsorted out automatically. It was transformational for both health care workers and administrators to move their constant hiring dance to snapNurse, just as it was for people to click a button on their phones to summon a car, track its location, and pay for a ride to anywhere. It used to take weeks and headaches to get a job, now nurses can be on the job in a day or two. The company started growing after hospitals in the Atlanta area started using the system. Revenue was almost one million dollars in the year. In the next year, it grew four times.

Covid arrived. The platform was originally built for on-demand next-day bookings, but suddenly hospitals didn't want different nurses in and out of work. They needed more assistance. Groups of nurses can be provided for months at a time. The company found itself the go-to staffing tech solution for hospitals around the world because of the flexibility of the system. Richards says that their ability to handle scale took them past all of their competitors.

There are problems with hyper growth. It's a challenge that has been around for a long time. It's all the more difficult when it's a result of what preceded the company. Kloss made a decision early in the company's history to allow nurses to be paid on the same day as their shifts. She says that they want to build a reputation that they deliver faster than any agency.

In order to get nurses to sign up on the platform, instant payment was important. There was no data on it, just a hunch from her and Jeff's experience in the industry.

It's a big squeeze on a company's cash flow because it's not a standard offering. You don't have to be a mathematician to know that if health care institutions are paying SnapNurse on a 30- or 60-day billing cycle but nurses are paid daily, the company will find itself coming up short. The team knew that the risk was worth it and that they could simply carry a large line of credit with a financial institution to cover the difference.

When its credit line was insufficient, it was on the hook for more and more payouts while it waited for its billing cycles to catch up. The company had to decide if it should tell nurses it couldn't meet payroll. Is it a good idea for the founders to get more credit?

Over and over it chose the other. A core part of the company's promise was same-day payments. Even if the promise was successful, it would still collapse. Richards says that they tore through the lenders. We did three times in 18 months to switch lenders and wait for the next one. After starting with a local Atlanta firm, the founders moved on to a specialist in funding staffing firms, and finally ended up with a $400 million line of credit from Wells Fargo.

The level of growth was unprecedented in the staffing industry, and bankers wanted to know if it was legit. "We doubled your line three months ago and now you want us to double it again?" the bankers would ask. The instant-payout limit was not increased in time to meet obligations the next day.

In order to handle all the incoming business, SnapNurse was having trouble growing its team quickly. Kloss made an analogy to her time in the TV business. You have a lot of different pieces to make a show. One department can take you down if the sound is off.

Kloss ran up against the limits of her hiring philosophy as she tried to land large contracts. If the right people were not available on the platform, Kloss would need to hire more recruiters to find them and get them ready. Kloss remembers that he would grab anyone to be a recruiters. The first 150 people were a mix of different ages and genders. A bartender was with us. There was a sous- chef. Four of my collegemates are from Westmont.

The technology saved what could have been a disaster. Recruiters had to do very little work besides being a call center to deal with problems, according to Kloss. The roles were paid top dollar by the company. Recruiters make a lot of money. Ours made $200,000 to $300,000 in the past.

The growing pains were visible. The company went from 20 to 150 employees in just one year. There were 350 workers a year later. Richards says they hired three times as many people as stayed. It was difficult. Online reviews betrayed a hard work culture. One said that the compensation was great. Excellent managed!

Kloss should not start on disgruntled reviewers. She curtly said that it was the same people over and over again. When they're fired, there's a lot of passion because we paid so much money.

It's a sensitive spot for her, a founder who started a business to improve on the status quo and then found herself, as a result of her own success, having to supersize the team, the platform, the revenue, and the financing all She says that they only had turnover when they added infrastructure. People are held to different standards when rules are in place. The people who were great in that period of time are starting to decline.

"I was never told 'You can't do that.' As long as you don't need a license, you can do just about anything."

When she first started using snapNurse, Khristina was a registered nurse taking per diem shifts and pursuing a master's degree "I liked having control over when I worked, and I liked getting paid quickly, and it was a way I could work around schedule changes from semester to semester," she said. Many of her fellow nurses needed the same flexibility. She says it's child care for a lot of nurses.

She worked per diem shifts on the side when she worked as a staff nurse. She was able to get health insurance through her full-time job and later through her school, even though many of her per diem colleagues depended on their spouses. Many of the nurses who provide our nation's health care don't get their own benefits. It's true that legacy staffing agencies offer nurses benefits, but it's also true that it's hard to maintain a flexible schedule if you have to work a lot. The cheap fee-for-service plan is being offered by SnapNurse to make up some of the difference.

When he got a full-time position as director of operations for an outpatient surgery center that employed SnapNurse nurses, he was able to ride out much of the swine flu epidemic there. She signed on for a six-month stint in Alaska, working 60 hours a week or more and making "once-in-a-lifetime money for nursing." It changed my finances. She was one of hundreds of nurses who showed up to help a hospital deal with a large number of surgeries that had been canceled when Covid patients filled all the available beds.

While her Alaskan adventure had been rewarding for her financially, she also experienced some of the drawbacks of per diem nursing. The hospital nurses in Alaska were not welcoming. She says there was a lot of tension. You can't refuse work because we know how much you make and we can cancel your contract.

And it's correct. The group on the short end resents pay gaps when they become extreme. According to the American Hospital Association, pay rates for travel nurses have doubled and even tripled since the outbreak of the H1N1 swine flu, which has led to calls for federal investigations of possible price gouging by staffing companies. Legislation is being looked at to cap travel-nurse pay.

Kloss doesn't agree with the idea thatSnapNurse has done anything. She came up with a way to meet the need for nurses in the market. She says that if you have 100 nurses and 1000 openings, all of the hospitals are competing for the 100 nurses. It's all across the country. They are competing against the entire nation, not just against local hospitals. It is all supply and demand.

Which is problematic. Even the most barren health care deserts can bring in professionals in times of need as a result of a national market for short-term nurses. If small markets have to compete against larger markets to pay higher wages, they are not better off.

A program to upskill its members to work in specialties where hospitals have particularly severe shortages is one of the things thatSnapNurse has focused on. The nurses have to work for a year for the hospital to pay for the training. Richards says it's not the total solution but the solution that's immediately available.

After two years of rapid growth, the company is scaling down. The company expects to finish the year with more revenue than last year and strong profits. The Ebitda margins are high for staff.

The company has 450 employees and 350,000 nurses on it's platform. I keep an eye on the numbers. Everyone should make a lot of money. We stay very lean. Kloss will step down as CEO and remain on the board.

Richards seems almost bewildered that one aspect of those chaotic days has been imprinted on the company in a positive way. The process of self-selecting was the flip side of the turnover during the Pandemic. He says that some people thrived in the system after learning it.

It is part of the story. Richards may look to the influence of his partner, Kloss, who has been through a lot. Her attraction to the resilient types is no wonder.

She thinks it's because she wasn't told she couldn't do that. You can do anything if you don't have a license.

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