Staffing marketplace Nomad gets $105M
Nomad Health, a New York-based health care staffing marketplace, raked in $105 million co-led by Adams Street Partners and Icon Ventures.
Why it matters: 2021 saw a surge of funding into health tech companies that provided relief to hospitals desperate to fill shifts, while giving nurses — facing burnout and unprecedented psychiatric symptoms — greater flexibility. Now, hospitals' demand for temporary health care workers is reportedly softening, with pay rates also dipping.
Between the lines: Even if hospital staffing levels improve, COVID will have a lingering impact on the country's nursing workforce, per McKinsey. Companies like Nomad are betting that travel contracts are here to stay.
- “One of the most important lessons that we've learned from this pandemic is that the clinical workforce wants to work that way,” CEO Alexi Nazem told Forbes. “They don't want to be bound by these very rigid and sort of limited opportunities, just the same way that all the rest of the workforce and all the rest of the economy is changing.”
Details: The $105 million investment comprises equity and debt, with a "substantial majority" being equity, Nomad tells Axios. Its total funding is now past $200 million.
- HealthQuest Capital joined as a new investor, alongside insiders Polaris Partners, .406 Ventures, AlleyCorp, and RRE Ventures. JPMorgan and Trinity Capital are new debt providers.
- The company is profitable and expects to generate $700 million in revenue this year, Nazem tells Forbes.
- The funding will support Nomad's expansion beyond travel nursing and into offerings for allied health professionals.
Context: Venture capital poured into tech-powered startups that connect health care workers with temporary jobs in 2021.
- Besides Nomad, that included connectRN, TrustedHealth, ShiftMed, IntelyCare and CareRev.
- More recently, SnapNurse in January scored $15 million in growth equity and a $100 million credit facility.
- While most upstarts have an independent contractor model, Nomad says it differentiates by providing its temp workers with employee benefits, including health care coverage, through the span of a role.
What we're watching: The extent to which the tech-forward entrants in health care staffing capture permanent share from the legacy players, pivot from temporary to permanent staffing, or see business retreat as the covid surge trends downward.