California county, non-profit help launch child-care startups

Adrianna Segura, a Stanislaus County, Calif. mother of two, was licensed to be a home-based child-care provider, but she didn’t know the first thing about starting a business. She knew how to take care of children, but she wasn’t sure how to file taxes, create contracts or what her rate should be. 

She turned to a county Family Resource Center for answers, which is where she learned about the In-Home Child Care Expansion Project, a 12-week cohort program Stanislaus County created with Nurture, a nonprofit that helps users launch home child-care businesses. Participants take training on the basics of marketing, budgeting, record keeping and parent communication through Nurture’s app and attend virtual weekly meetings where they receive hands-on coaching and connect with peers in their cohort. 

“When I first opened my daycare, I didn’t know I had to have a 1099 form, I didn’t know how to put taxes to the side, because ‘Uncle Sam’ was going to collect at the end of the year — all of those tedious things that should be common sense,” Segura said. “But they didn’t teach this to us in college or in high school. 

“They didn’t say, ‘When you run a business, this is how you should run it.’ And I feel like that’s what Nurture is — it’s an extension.”

Before teaming up with the county, Nurture worked with the workforce development department of Stanislaus County’s neighbor, Merced County, to develop the curriculum through conducting “empathy interviews” with local home childcare business owners to find out what people wish they knew when they were first starting out, according to Jennifer Brooks, executive director of Nurture.

Stanislaus County and its city of Modesto devoted American Rescue Plan Act funding to the In-Home Child Care Expansion Project, which has already created 536 licensed childcare spots and is on track to help launch roughly 230 home-based childcare businesses in the county over the course of two years. 

The funding goes toward the training itself, and each participant receives $2,500 to help get their childcare business off the ground. Segura used the funding on marketing her home childcare business and to purchase an outdoor play set, which she said has helped set her apart from other local home childcare businesses.

“For low-income people, [that funding] is essential for opening their door,” Brooks said. “It costs money to get licensed — you have to buy equipment, you need to have some basic supplies, and the people that we’re working with are often like, ‘I can’t do this right now, because I don’t have the $35 to pay for the orientation that I’m required to take,’ and those are the people we’re targeting, so this start-up money is critical.”

The project is part of the broader “Stanislaus 2030” initiative, a public-private partnership working to create more quality jobs, reduce the number of families struggling and focus on growth in the county. The Stanislaus 2030 plan involves growing the supply of child-care providers and building awareness of subsidies. 

According to a Bipartisan Policy Center report, in California’s Central Valley, the economic impact created by each new child-care space is $34,000 — contributing factors include increased productivity and parents’ ability to go to work in the first place. 

“Quality child care is the most impactful anti-poverty strategy out there,” Brooks said. “It has generational effects on health and wealth, incarceration, etc., that if we can get that right, then we’re really going to make a difference.”

Prior to the implementation of Stanislaus 2030, only 17% of working parents in the county had access to licensed childcare, according to county data. A major obstacle in childcare for the county is that it’s never recovered from the 2008 recession, according to Tony Jordan, executive director of the Child and Family Services Division at the Stanislaus County Office of Education. 

“People lost their housing in just outrageous numbers, and a lot of those people had to close their family child-care businesses,” Jordan said. “So, we’ve never really recovered from where we were at back then — we are still running short.

“… Laying on top of that economic downturn, job loss, pandemic, we were really at a low point, so this partnership, I think, came at the right time, with the right heads, with the right investments.”

Stanislaus County discovered through its economic development assessment with the Brookings Institution, a research foundation, that it needs 36,000 more child-care spots for children ages 11 and under in order to meet workforce demand — meaning the county needs to incubate an average of 150 new childcare businesses each year from 2020 to 2030, according to Brooks.

“We’re starting with this 36,000, but that is a number that you can’t even get your hands around in any way,” Brooks said. “So, we did an analysis where we looked at ‘Where is the greatest shortage of child care?’”

Research showed that seven ZIP codes had the worst “child-care deserts” in the county, particularly for infants and toddlers. “That’s the age group that’s on fire in terms of the shortage,” according to Brooks. 

To help bridge those gaps, Nurture does targeted outreach in the seven ZIP codes, which has included partnering with the school district to reach elementary school parents and presenting information at farm worker fairs, to promote the availability of child-care subsidies and create more awareness around the opportunity to create a home child-care business.

A county report found that a lack of awareness surrounding eligibility for child-care subsidies led to them being underutilized, particularly among non-English speakers, according to Brooks.

“Child care is expensive for everybody, but subsidies are essential to making this broken market work, particularly in low-income communities,” Brooks said. 

Nurture initially partnered with community organizations to share information on social media, but it was only effective in reaching the county’s English-speaking population (and its childcare deserts are primarily low-income rural communities with a large Latino population), so the nonprofit altered its approach to be more “word-of-mouth,” according to Brooks.

“It was that personal experience, sharing one-on-one, or having the flyer hung in the bodega, with the tear-off phone numbers — not the QR code — that’s next to the handwritten flyer of, like ‘Room for rent,’ that’s where we were going to get people,” Brooks said. “So, we found that we really had to get into the community.”

Nurture also now has an ambassador program, which incentivizes people — like Segura — who have graduated from the course to share their experiences with others interested in creating a home childcare business.

Segura had spent roughly a decade working in dentistry when the COVID-19 pandemic hit. Working from home for the first time, she realized how valuable the additional time with her two young children was, and she decided to investigate what it would take to launch a childcare business. 

“I did the leap of faith, and I took the jump,” Segura said. “My children were the ones that inspired me, because I came to understand the first five years are so important in their life, and I wanted to create that safe environment for them.”

During her 12 weeks in the Nurture cohort, Segura learned what it takes to run a home childcare business, including what she needed to document throughout the process and the importance of keeping contracts up to date and building out a waitlist. She also took trauma-informed classes, which she said has helped her become a better childcare provider. While Segura already had a childcare business license prior to joining the cohort, participants are walked through the licensing process during the program and the majority get licensed upon completion.

“I feel like it’s important for providers to take a business class,” Segura said. “Because as daycares, I feel like we get looked down upon only because it’s like, ‘Oh, you just stay home and watch children.’ And we should move from that point of view into ‘No, I’m a business.’”

Segura said Nurture taught her how to advocate for herself as a childcare business owner. 

“I have to break it down to the parents,” Segura said. “I’m like, ‘When we watch children, you expect me to watch a child at $5 per hour, and you don’t expect yourself to work at $5 per hour at a regular corporate job.’ The [cohort] gave me the tools where I’m able to communicate with the parents instead of shutting them down or having myself feel like I’m putting myself last, because I want to make this parent stay with me.”

After Stanislaus County found success with the program, San Joaquin County also adopted the Nurture model, devoting roughly $400,000 in American Rescue Plan Act funding toward implementing it, according to Amanda Hughes, executive director of Stanislaus 2030.

“I love how our three counties are learning from each other around a shared issue that’s hurting our economy,” Hughes said.

Nurture “isn’t just an app — it’s a community,” Segura said. After completing the cohort program, Nurture graduates keep up with each other through a group chat, which includes providers across Stanislaus and San Joaquin counties. The chat acts as a way to share best practices or seek advice, and is a great resource because “childcare is very lonely for providers,” Segura said. It’s also a practical way to make connections for clients, she added.

“If I have a parent that lives in Patterson, but needs childcare in Modesto, I can easily go on the chat and say, ‘Hey, providers, I’m looking for a provider in Modesto with these hours, does anybody have availability?’ It’s also an easier way for parents to feel a connection, because when I tell them, ‘Oh, I found somebody in Modesto, and she did this cohort, and I can trust that if you like my setting, you’re going to like her setting too, because we were basically taught the same thing’ — it’s that connection, it’s community, networking.”

Access to child care is a key element in building a “thriving and economically sound community,” and the county’s work with Nurture through “Stanislaus 2030” and getting more people licensed is helping to make that a reality, according to Jordan.

“The work of young children is to be in a safe, nurturing, loving environment where they can learn, grow, explore, thrive,” Jordan said. 

“So, when we don’t have quality childcare, when we don’t have people that are licensed, that have some type of child development in their background and in their repertoire, the quality is not as great as it could be.”