Age tech is a trillion-dollar industry where everyone is a potential consumer
5 Minute Read
What you need to know: Worldwide, the number of people over 65 totals 635m and could rise to 2B by 2060. The people getting older and living longer want to age comfortably at a home, but a lack of connectivity and social isolation makes it difficult. Venture capital funds have started investing tens of millions in age tech.
How you can capitalize:
- Improve connectivity and decrease social isolation through the sharing economy. Examples include Silvernest, which is a roommate service targeted at seniors.
- Turn any number of clinical treatments or technologies into a direct to consumer service that reduces doctor and hospital visits.
- Use voice technology and other technologies to transform homes into areas where elderly people can feel more connected and where data can be collected on their well-being.
Startups like to position themselves as problem-solvers: Taxis were broken, so Uber introduced ride-sharing. Dating sites were lame, so Tinder introduced swiping.
But in the grand scheme of things, the problems addressed by those startups were miniscule. None of them compare to getting older. The difficulties and lifestyle changes of aging are potentially the toughest — and most lucrative — problems to solve.
In the United States, 10k people retire every day. By 2030, the share of U.S. population over 65 will be 18%, up from 13% in 2010. Worldwide in 2018 there were about 635m people older than 65. That number could rise 98m in the United States and to 2B worldwide by 2060 (and it almost certainly includes you, reader!).
“The good news is we’re living longer than ever before — yay,” says Wendi Burkhardt, co-founder and CEO of Silvernest, a roommate matching service aimed at retirees. “The bad news is we don’t know what to do now that we’re living longer than ever before.”
What we do know is that people who are getting older and living longer want to age comfortably and safely and preferably “in place,” at the residence of their choice. That means opportunities in age tech abound for startups that can make comfortable, affordable living a reality.
These opportunities include networks that improve connectivity and decrease social isolation through the sharing economy, wearable technology that prevents falls and aids people with adherence to medication, and clinical products that can be purchased on the consumer market instead of at the doctor’s office. Products that don’t seem to have a direct connection to age tech could prove to be a boon for aging, including smart home accessories that allow seniors better safety in their houses.
The potential audience is vast. By the AARP’s estimation, the 50-plus population harnesses about $7.6T in spending power (that’s “T” as in trillion).
“Millennials are broke,” says Andy Miller, the AARP’s SVP of innovation and product development. “Money is not with millennials. Money is with the older folks.”
Source: US Dept. of Health and Human Services
The sharing economy ages
In the past, it was expected that family members could provide care for aging relatives, at least until an assisted care facility became necessary. Now that people are living healthier for longer they’ve become empowered to seek more fulfilling ways to live, ways that resemble preferences they had when they were younger.
Burkhardt jokes that when she talked about retirement she would say she wanted to have a big house with a lot of her friends in it. But the goal has become serious. “A lot of people have that similar conversation,” she says. “None of us want to be lonely.”
She started Silvernest in late 2015 — with $200k in personal funding — to facilitate shared living situations for a clientele of mostly retiring boomers. The service is like a mixture of Craigslist, AirBNB and OKCupid. Potential housemates create profiles and are given pairings with homeowners on Silvernest that would make an ideal match.
The homeowner and the roommate decide on financial terms. Silvernest charges a $25 monthly fee for homeowners using the service (potential roommates can browse for free). The first year, in 2016, Silvernest had about 10k customers who found a qualifying match. In just under three years, the company has grown tenfold, as Burkhardt anticipates that number to reach nearly 100k. Silvernest has raised $5m in funding. Though it only serves the United States, residents in dozens of other countries have expressed interest.
“I often say that five or seven years ago AirBNB and Uber forever changed our lives,” Burkhardt says. “The emergence of the sharing economy started to influence the many ways we think about living and we are going to see that is the case particularly in the next generation of aging. I think the sharing economy is really going to influence the next generation of aging.”
Other startups focused on connectivity and the sharing economy include Papa, which connects college students with seniors for errands and companionship and has raised $3.2m in funding. Some startups have stumbled into connectivity by accident: SingFit in Los Angeles was originally focused on music therapy. But the company has moved some of its therapeutic services to VR, allowing for aging family members to connect with relatives throughout the country for an activity.
The mostly-untapped VR market offers many opportunities for providing long distance connections.
Opportunities with voice technology
In addition to improved social settings, people who want to age at home need safety. This has opened up a market for high-tech wearables. These are monitoring devices that can do everything from transmit location and send emergency alerts (Safe365) to measure whether they have taken the proper amount of medication (Medisafe and AdhereTech). The Zio patch detects potential irregular heartbeats. D-Free is a Japanese toilet device that predicts and tracks bladder movement.
Perhaps the best opportunity in monitoring involves voice technology. Voice User Interfaces — similar to Alexa — allow elderly people who can’t reach or move around as easily to accomplish household tasks and control their environment. The same technology can be used to detect when something is off-kilter and a person needs to be checked.
In a post on Medium, Max Amordeluso, Amazon’s “lead evangelist” for Alexa in the EU, highlighted these opportunities around voice technology:
- Detection of the onset of degenerative diseases based on changing vocal patterns
- Elderly specific games and entertainment
- Activities that help them reconstruct warm memories
And while monitoring systems remain necessary, Miller says one of the next stages for age tech development is prevention. Rather than monitor the possibility of a fall, technology can be used for preventing falls. Walk With Path, for instance, has created an insole that vibrates, giving wearers constant feedback of when their feet are touching the ground and reducing the potential for imbalance.
An infrastructure embracing age tech
Four years ago, sensing there wasn’t enough private momentum in age tech, the AARP formed The Hatchery, an accelerator that helps startups focused on innovation for the 50-plus audience. The AARP has also teamed with JP Morgan to create a $40 million innovation fund.
Since the formation of The Hatchery, private investors have caught up to age tech, most notably Reddit co-founder Alexis Ohanian’s Initialized Capital. Though it is best known for funding startups like Coinbase and Instacart, Initialized Capital has used some of its $500m war chest to fund age tech companies like Papa, Ro (a digital health clinic) and Voyage (an autonomous vehicles company aimed at seniors).
The proliferation of attention and funding make age tech a potentially lucrative space, in addition to one where you could make a truly beneficial product.
“These are societal problems that are really hard to solve,” Miller says. “Creating another dating app is not that big of a challenge. Helping someone with Parkinson’s walk again would be solving a really big problem.”
Steph Smith contributed research to this article.