Age-Tech: technology’s next frontier
Venture capitalist Dominic Endicott defines Age-Tech as "services purchased by older people, services purchased on behalf of older people, services traded between younger and older people and services delivered to future older people". With around 1 billion people over 60 years old living on this planet, it is estimated that in 30 years, 20% of the world’s population will be over 60.
In 2050, The UN estimates that one in six people in the world will be over the age of 65. Aging is one of the greatest social and economic challenges of the 21st century. This growing demographic creates an increasing need for tech to start catering to older adults. Age-Tech was born to do just so.
What is Age Tech?
In 2015, the silver economy was estimated at 3.7 trillion euros in the European Union. The term ‘silver economy’ refers to services and goods purchased by or for individuals over 60 years old, who are now the fastest-growing demographic in the world. This demographic has even been called the ‘Silver Tsunami’.
Age-Tech is a fresh new niche that focuses on tech for older adults. Indeed, the severe health effects on elderly people in particular and the social distancing the pandemic has called for has deeply increased the challenges older generations must face. Loneliness, feelings of being obsolete faced with the workings of a new, fast-paced world… More often than not, the elderly care market runs on inefficient, outdated processes, which doesn’t reach the full potential of performance it could have. This has created a greater demand for technological solutions made for seniors, which could lead to the Age-Tech market reaching a value of $2 trillion by 2025. Though a deep divide between older and newer generations regarding tech still exists, the COVID-19 pandemic saw a great number of older adults adopt tech. Hence, parameters seem to be lining up for the boom of the Age-Tech market.
Economic prompts for an Age-Tech explosion
The McKinsey Global Institute says that between 2015 and 2030, people over 60 will have generated half of urban consumption growth. The report stipulates that older adult consumers spend more than younger adults, because of expenses such as medical care for example. However, they are thought to contribute to more than just the medical industry - it is thought that they will contribute to over 40% of growth in transport, entertainment, and housing in the United States only.
The term ‘Longevity Economy’ defines the ensemble of all economic activities tending to the needs of older adults. By 2030, Americans over 50 are projected to spend over $200B annually on tech products.
Facing these perspectives, some businesses have already started investing in the needs of the older adult. GreatCall and Lyft, for example, offer a transportation service whereby clients can press one switch on their screen which allows them to directly speak to someone who they can tell their destination to. GreatCall was in fact recently purchased by BestBuy: “In health, we acquired a leading connected health services provider for aging consumers GreatCall and took a tangible step forward in our strategy to have seniors live longer in their homes with the help of technology,” says Best Buy CEO Hubert Joly.
Perspectives and prospects
The Age-Tech niche and its market are well expected to grow. Rapid digitization adoption and fast growth of the longevity economy is projected to provide a strong basis for Age-Tech to thrive. More successful Age-Tech companies are predicted to be acquired, Apple, Microsoft, Google, and others are anticipated to be enthusiastic about the niche, especially Amazon who is expected to be well-ahead in the market.
Global tech trends of the sector
Age-Tech, a niche that caters to older adults’ needs, naturally focuses on sectors such as health to develop in. Age-Tech is estimated to be able to completely transform and offer precious aid for the following sectors:
Key activities of Independent living (medication, hygiene, nutrition)
Communication and Social Connectivity (social communication, hearing, patient-physician conversation translation)
Transportation (public transport, driving)
Personal mobility (monitoring, rehabilitation, assisted movement)
Access to healthcare (telehealth, e-care planning)
Cognition (financial security, training, monitoring)
Some have narrowed down three fundamental cornerstones of the Age-Tech market: Physical & Mental Health, Financial Well-being as well as Occupation & Purpose. It is no surprise that the Age-Tech market is focused on care: in Germany, 4.9 million people are dependent on care, 80 % of which are cared for at home. It is said that in Europe, health significantly declines after 64 years old. With a lack of mobility, many elderly people suffer from loneliness and isolation - there is a real need for technology to step up and render itself available to aid older adults in becoming more independent and connected.
Let’s take a look at the Israeli market for Age-Tech startups to understand the trends. As you may know, Israel is known as the ‘startup nation’, and it is safe to say it has a thriving Age-Tech ecosystem. It has recently been overflowing with creative ideas to help older adults with technology.
One company provides a simple and easy-to-use remote control hooked up to the TV that could truly help end loneliness for seniors. Others use Artificial Intelligence to provide robotic companions for seniors that could even act as home-based physician helpers. Some are even developing devices that could analyze human waste to provide valuable insights on the users’ health, especially if dealing with medical conditions that need constant monitoring. These Age-Tech solutions could truly allow senior citizens, as part of the longevity economy, to lead a more comfortable and less lonely lifestyle. Families will be able to provide easy, adapted solutions to care for their parents in ways never heard of before. These ideas have the potential to produce a cultural shift whereby the narrative could change: this time of life could become a moment filled with opportunities and instead of physical deterioration.