Venture Capital Is Driving Innovation in the Older Market

Launched in July 2020 by Alan Patricof and Abby Levy, Primetime Partners is the first early stage venture capital fund focused on the underserved aging population—a trillion dollar market. The $50 million fund makes investments of up to $1 million in new companies providing products, services and experiences that improve the quality of life for older adults. The market is gaining attention—they attracted investors and closed the fund in just eight weeks, COVID-19 pandemic notwithstanding.

Several of the companies in which they’ve invested are focused on health: fitness, nutrition, women’s health, plus home caregiving and telemedicine. Others enable older adults to learn new skills, make new friends, manage finances and use home equity. An explicit part of Primetime Partners’ mission is to seek out and support older entrepreneurs, or “founders over 50.”

At age 85, Patricof is in his third act as an investor and entrepreneur. In 1969 he founded the firm now called Apax Partners, one of the first and largest private equity firms operating internationally. In 2006 he founded the venture capital firm Greycroft to focus on digital media. Along the way, he has helped build hundreds of companies, including Apple, AOL, Office Depot, Huffpost and Venmo.

Levy has spent her career helping businesses and consumer brands grow as an operator, entrepreneur and advisor, most notably in the wellness sector. She was responsible for strategy and growth at the fitness company SoulCycle. She then teamed with Arianna Huffington to launch Thrive Global, a behavior-change technology company focused on employee productivity and wellness.

Morison spoke with Patricof and Levy about the work and ambitions of Primetime Partners.

What motivated you to form Primetime Partners?

Alan Patricof (AP): The older generation, including the baby boomers, is not only becoming a much larger segment of the population, but they are going to live longer, and they have the most money. But when we looked around, there weren’t a lot of companies that had been formed to meet their needs. We decided to start a modest fund to see what the opportunities are and focus on early stage companies. We’re now almost a year old, we've looked at over 600 companies and we’ve made 13 investments.

Abby brought a special focus on being a thought leader in this area. From day one, we wanted to speak out, whether it was at conferences or in blogs or articles or on television, to promote this what I call “ageless generation.” Part of our ambition is not just backing other people’s ideas, but generating some ideas that we could help get off the ground.

You launched the fund in the middle of the COVID-19 pandemic. How has that shaped the market?

Abby Levy (AL): The COVID-19 pandemic has shined a light on the older population, especially the frail portion of it who have unfortunately suffered the most. It has drawn more attention to the older market and debunked some of the stereotypes. Seventy-seven percent of older adults are using telemedicine—so much for being technology-averse. Entrepreneurs have started coming out of the woodwork, more open to starting businesses for this audience.

‘We really try to identify and nurture older entrepreneurs as venture-backable startup CEOs.’

COVID hasn’t changed the issues so much as it has raised public consciousness of them. For example, aging in place is not a new thing. Ninety percent of Americans have wanted to age in place for a very long time. And there’s been more emphasis on social isolation and loneliness, but a third of seniors always lived alone. This greater visibility encourages more entrepreneurs to create solutions.

Tell us about your focus on older founders.

AP: I guess I’m the poster child here, given my age. There are people around like me, who are older, who have sold or retired from their companies, and who have energy, health and tremendous experience. I wanted us to put a sign on the front door saying if you're over 50, you don’t have to pack it in and go play golf. You can go back into a new version of the same business, attract people you’ve worked with, and do it all over again. Not necessarily in the aging market. We’re here to encourage you.

AL: We really try to identify and nurture older entrepreneurs as venture-backable startup CEOs, and I’m happy to say that within our portfolio, three of our founders are 50 plus. We’re working on a pitch contest right now, kind of like “Shark Tank” for older entrepreneurs that we’ll launch in September. It’s a way to get the message out that your life experience, your network, your judgement have tremendous value, and if you have the inclination or an idea, entrepreneurship is a wonderful second or third act.

What roles do alliances play in addressing the older market?

AL: They’re absolutely essential, because everybody’s looking for solutions to very big problems. As examples, 50 percent of Americans are going to outlive their savings. And we know our housing stock is not adequate for aging in place. And look at the trends in Alzheimer’s and cognitive decline. No startup and no government program is going to solve such problems. Everyone has to be working on them, and public-private partnerships are so important because historically so much of the funding and the innovation have come from academic, government and social institutions.

Thought leadership and collaboration are so important because there are fundamental challenges facing our society around aging that have not been in the public discourse. And it’s going to take a village, more than a village, to change the future of how we age. Ours is a for-profit fund, not a social impact fund, but if we don’t have social impact, we’re not doing our job right.

What are some misconceptions that enterprises and entrepreneurs have regarding the older market?

AP: A big misconception is that the Millennials are the hot market, that they spend the most, are the most technologically savvy, are the most innovative, are the ones who will take chances on new things. The corresponding misconception is that the older market is slower and set in its ways. But in fact, plenty of older people are online and dealing with ecommerce. The older market is the fastest growing. It’s a vibrant market with its own specific needs.

As an example, when people hear the word “caregiver,” they may think of professional caregivers. But right now, there are tens of millions of people who have to care for their parents or their grandparents or an ailing spouse or relative. Not everybody can afford professional caregivers, and Medicare doesn’t reimburse people for caregiving.

‘We have to recognize that we’re in the gestation period for this market.’

So we need to focus on the fact that every single one of us is potentially going to become an unpaid, nonprofessional caregiver. I’ve been a caregiver, and almost everybody you know is going to have someone to take care of. Informal caregivers have a lot of unmet needs, and that by itself is a big, fertile part of the aging market and getting bigger every day.

AL: Another misconception is that older people are one big segment. In fact, the 50-plus population is a very heterogenous market, not one consumer group, but hundreds or thousands. There are so many different segments of pre-retirees and retirees in many different life stages.

When people come to us and say they’re targeting older adults, I always say, wait a second, that’s like saying we’re going to target women between 0 and 50. There’s white space in terms of audiences that aren’t being reached.

What have you learned over the past year?

AP: Most of the companies we've seen are relatively early stage. A lot of new companies are getting their sea legs, getting their foundations established. We have to recognize that we’re in the gestation period for this market.

AL: Very few innovations are at scale. And it’s going to take more than the typical venture startup machine to get there. That’s why I think public-private partnerships are going to be needed to realize the potential for improving the lives of older adults.

The other thing that I’ve come to appreciate is that almost everything is grounded in health. That fundamental human need is underpinning the majority of the start-ups we’re seeing. Not just because that’s where the money is, but also because at the end of the day that is the human need we should be solving. It’s been a personal as well as a professional learning for me to see how critical staying healthy is to everything we do.

AP: We've found that more and more people are more conscious at an earlier age of how they can slow the aging process, how they can prevent diabetes and heart disease, how they can avoid Alzheimer’s. What’s happening with analyzing biomarkers, improving nutrition, fitness and brain health—those things will benefit younger adults as well. People are going to live longer, and we want to help them get the most out of life. All of it is very exciting. You're talking to two people who are just hyped up with enthusiasm about what we’re doing.

Robert Morison is senior advisor at Age Wave, and a researcher, writer, speaker and consultant. He is co-author, with Ken Dychtwald, of “What Retirees Want: A Holistic View of Life’s Third Age.”

Photo: Alan Patricof, left, and Abby Levy. 

Courtesy Primetime Partners.