Isaac Newton’s first law of motion tells us that a body at rest will remain at rest unless acted on by an outside force. We believe that our first-of-its-kind AARP Innovation Fund will provide the outside force needed to spur private-sector investment in innovative products and services focused on improving the lives of people ages 50 and older as well as those of their families.
We all know the world is aging. Think about this: of everyone who ever lived to age 65 since the dawn of humans, two-thirds are walking the earth today! By 2050, 17 out of every 100 people on earth will be ages 65 and over. By 2030, the number of Americans 65 and older will have nearly doubled to some 78 million — that’s 1 in every 5 of us. One in 3 Americans will have celebrated their 50th birthday.
What too many have yet to realize, however, is that the way people are aging is also changing dramatically here in the United States and throughout the developed world, thus creating among those who are ages 50 and older vast new needs and interests — along with vast new opportunities for private enterprise.
Better nutrition, medical care and lifestyle choices are offering us an opportunity for an additional 25, 30 or more years of being independent, active and creative. It really is no exaggeration to say that a whole new stage is being added to our lives between middle age and what we used to think of as “old age.” But we will need more solutions and options to help get us there, and today we’re not seeing enough private-sector investments and innovations that are focused on our 50-plus population.
We decided that the interests of our members would not allow us to sit back and wait. AARP needed to do all we could to become an effective outside force to encourage needed investment.
The AARP Innovation Fund will provide capital to innovative companies. We have partnered with JP Morgan Asset Management in this initiative and have committed $40 million to the fund. We are focusing the fund on three health care-related areas.
Health care is an area where the needs of our 50-plus population and the opportunities for investment converge. Our 50-plus citizens are searching for new and better tools and technology to help them stay healthy, independent and productive as they age. Many of the innovations necessary to meet the needs of our 50-plus population are only in the early stages of development — or do not yet exist.
Here in the United States, our 50-plus community accounts for $3.1 trillion in consumer spending, and $1.6 trillion of that amount is on health care. Health-technology products and services could benefit as many as 160 million consumers and represent $30 billion in new revenue over the next five years, according to a 2014 Parks Associates report.
Specifically, the three health care-related areas of our focus are the following.
- Aging at Home — Development of products and services that use technology to enable older adults to continue living in their homes safely and affordably, such as home sensor activity tracking; hearing and vision health; mobility assistance; meal plan, delivery and cooking solutions; social communities; and physical augmentation devices.
- Convenience and Access to Health Care — Advancement of products and services that enable 50-plus consumers to adopt positive health behaviors, such as telemedicine, consumer diagnostics and consumer care transparency tools.
- Preventive Health — Expansion of the market for products and services that help 50-plus consumers prevent the onset of serious health conditions, such as diet and nutrition management, stress and emotion management/therapy, fitness apps and programs, integrated health engagement incentives, and cognitive and brain health.
JP Morgan Asset Management Private Equity Group has been designated to review potential investment opportunities. AARP then reviews each recommendation to ensure that it meets the three investment themes and complies with AARP’s public policies. AARP also has the opportunity to recommend companies to JP Morgan for its evaluation.
The recipient of the first investment made by the AARP Innovation Fund, announced in 2015, was One Medical Group, a U.S. leader in technology-enabled primary care. In addition to operating physical locations, One Medical Group uses broadband and mobile technology to give its members virtual access to health care providers and resources through features such as same-day appointment booking, prescription renewals, messaging and digital dermatology.
In 2016, the fund made its second investment in Fresh Direct, an online grocer and food business that delivers fresh, healthy food to customers’ homes. The fund’s most recent investment was in Anki, an artificial intelligence company bringing consumer robotics into everyday life.
Published October 5, 2018