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Q&A with NextStep’s Chris Hedrick on Building the Health Workforce

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NextStep Cofounder and CEO Chris Hedrick

The compounding factors of the COVID-19 pandemic and an aging population have placed an unprecedented level of pressure on our health workforce, putting Certified Nursing Assistants (CNAs) in high demand in the United States. Not only are CNAs highly sought-after amid a caregiver shortage, but this role also serves as a critical entrance into the health workforce. An effective springboard, many workers advance from CNA to Registered Nurse as they grow a fulfilling career in health.

NextStep is a social enterprise that provides tuition-free training to help aspiring health workers get certified and placed in CNA roles. As of November 2021, NextStep is Johnson & Johnson Impact Ventures’ (J&J Impact Ventures’) most recent investment.

We spoke with NextStep Cofounder and CEO Chris Hedrick about how the company equips future CNAs with the education and support needed to jumpstart a career in caregiving.

JL: NextStep is a big idea that meets a critical need. What inspired you to found NextStep, and what challenges have you faced along the way?

CH: For many years now, I’ve worked on technology solutions that create workforce opportunities. I was previously the CEO of a university in Rwanda called Kepler, where I worked with bright and motivated students who were underserved by their educational experience. We provided them access to an online, US-accredited degree focused on skills needed in the workplace.

When I came back to the US, it was clear that the healthcare sector of the economy needed skilled workers. After a deeper assessment, we decided to focus on the CNA profession. Then Pioneer Square Labs and I brought in workforce development expert Charissa Raynor to help found a new company that would expand the pool of certified CNAs.

To fund NextStep’s tuition-free model, we rely, in part, on employers who pay a placement fee to hire NextStep graduates. When we started NextStep, I thought it might be difficult to convince employers to provide the placement fee. In reality, attracting employer partners has been one of the easier parts of the business because they see the value in our model. Recruiting students has been a bigger challenge, especially amid the COVID-19 pandemic.

Nonetheless, we’re seeing exciting growth. We began in Colorado and quickly became the largest provider of CNA training and placement services in the state. We’ve expanded into Washington and Oregon and are planning additional expansion in the coming years.

VB: Tell us about NextStep’s business model. What makes NextStep stand out from other health startups?

CH: The CNA training market is fragmented, with regulations differing across state lines. NextStep provides a combination of online and in-person learning with on-the-job training that meets state regulations—and we do it efficiently by leveraging our technology, platform and innovative curriculum.

The value to partners is clear. The first long-term-care provider we worked with had been consistently understaffed for years. NextStep was able to help them fully staff their facility for the first time. We provide our partners with the workers they need efficiently, and we know our CNAs will stay on the job, keeping turnover significantly below the industry average.

We see lower turnover among NextStep graduates because we provide them with technical training and readiness support to be prepared for complicated employment settings, like skilled-nursing facilities or home-based care. We also provide our students with mentors throughout their training and after they’ve been placed to help address challenges that may arise on the job. Lastly, we strive to create a community that can provide peer-to-peer support as our graduates continue to further their careers and education.

JL: How are you working with J&J Impact Ventures?

CH: We’re very excited about our relationship with Johnson & Johnson Impact Ventures. This investment will convert into shares when our Series A round of funding closes, at which point J&J Impact Ventures will be a substantial shareholder in the company.

Beyond the financial support, we’re excited for the opportunity to interact with mentors within the Johnson & Johnson Family of Companies who can help support NextStep as we grow our company.

Ultimately, our partnership with Johnson & Johnson Impact Ventures helps validate our credibility, especially in the eyes of future learners.

JL: With the COVID-19 pandemic, we saw increased focus on the importance of public health and the role of frontline health workers. What can we do to ensure this attention doesn’t fade?

CH: It's important to invest beyond the short-term needs of pandemic response to foster and strengthen our public health programs and support our frontline health workers. In the US, the pandemic showed that our healthcare system needs to provide a higher level of support for its workers.

As a society, we need to recognize the value that frontline health workers bring to our families and lives—and reflect that immense value in better compensation. We’re seeing a substantial increase in wages and benefits for CNAs, which I think is the most tangible reflection of ongoing appreciation for frontline health workers. And I hope with the legislation that is in Congress right now, we can see this trend grow.

VB: Impact investing is a growing market, but only a small portion of global impact investments go toward health. What do you think investors need to know when it comes to health-focused enterprises?

CH: Health investments are, in some ways, more complicated to do at scale. We haven’t seen a lot of investment in the healthcare workforce, and I think that’s where you can see a wonderful opportunity for impact investing that will have a direct and positive impact on both health workers and the people they care for. When matched with the right business models, these investments can have a great financial payoff.

As NextStep expands its impact nationwide, the importance of training and supporting qualified frontline health workers will remain salient, and the gap between supply and demand for these workers will become smaller. Consistent and quality care creates better healthcare outcomes for those in need, and NextStep is a driving force in providing people with the opportunity to build a meaningful and successful career in health.