A tech world luminary has turned his attention to solutions targeting older adults — and he believes that the senior living sector will undergo “major change” within the next decade.
Alexis Ohanian rose to fame as the co-founder of Reddit. The social news website was acquired by Conde Nast in 2006 for a reported $10 million to $20 million, when Ohanian was 23 years old. Currently, Ohanian is managing partner at Initialized Capital, an early-stage venture capital firm that he co-founded.
Initialized has more than $500 million invested in a portfolio of more than 200 companies. It recently raised its fourth fund, of $225 million. Ohanian views elder tech as an area of particular opportunity.
Already, Initialized has invested in a few startups focused on senior services and care, including autonomous car company Voyage, “grandkids on demand” startup Papa, and secure banking service True Link Financial.
Ohanian recently spoke with Senior Housing News about what Initialized looks for in an elder tech startup, the future of robots in caring for older adults, and the transformational changes that he predicts will come to the senior living industry within the next 10 years.
What senior living disruption might look like
Initialized usually invests in startups at a very early stage, often when it’s just a founder involved, Ohanian explained. Because of this, he did not formulate a grand plan to target elder tech for investment, but rather has come to appreciate the opportunity over time as his firm has backed specific ventures in the space.
Still, he is well aware that about 10,000 baby boomers are retiring every day in the United States.
“This is a massive market to be serving that’s quickly growing, and also now has a kind of tech fluency that we’ve never seen before,” he told SHN.
Older adults nowadays are commonly on platforms like Instagram to view photos of their grandkids, and smartphones have become ubiquitous among all age groups, he noted. This is allowing tech creators to do more than in the past to serve seniors.
Ohanian thinks of elder tech in two categories. In the first category are companies that are taking existing products or systems and making them better or more tailored to the senior user. He points to Voyage as an example.
There are many autonomous car companies out there, but Voyage recognized that these companies often struggle to glean sufficient data derived from cars “learning to drive” by using their cameras and sensors on actual roads. Large retirement communities like The Villages in Florida provide a perfect testing ground, so Voyage is bringing self-driving cars to these settings to improve the technology and harness it for a population that can particularly benefit.
“These communities like The Villages have massive, massive square miles of roads, and also a controlled environment, where if the cars are only going 25 or 30 miles per hour, that’s actually a feature, that’s great, because that’s about how fast most of these folks want to be driving anyway,” Ohanian said.
The other type of elder tech creates something totally new. Papa is an example of this, Ohanian said.
The startup pairs older adults with “Papa Pals” — younger people, often college age, who connect with seniors to provide rides, help out around the house, teach them to use technology products, and just generally provide companionship to alleviate the loneliness that is pervasive among the older adult population.
Papa Pals are in effect a “totally new class of caregiver,” Ohanian said.
“I wish that I could predict the Papa Pal bucket, but that’s what the really smart founders do,” he said. “And when I look at the other bucket, of dramatically improving existing systems, I can’t help but feel like there’s going to be some change in the nursing or senior care space itself.”
Ohanian believes that a new senior living brand could emerge that has “amazing software really built into every bit of the process” to better appeal to and serve the Internet generation. Considering that he can now track the progress of his pizza delivery, he thinks that a far greater level of transparency and security can come to senior living and care, and that consumers will want and expect this.
It’s likely there will be a mix of new players creating sophisticated tech-supported operations from scratch as well as tech startups offering next-gen solutions to existing players to enable them to “level up,” Ohanian said.
“We’re seeing this now in so many other industries,” he said.
For instance, Initialized has invested in a startup called Standard Cognition, which is creating technology for retailers to compete with Amazon. Across the country, Amazon has started to open cashierless stores, where customers can walk in, grab a product, and walk out, with their accounts automatically debited. Traditional retail companies do not have the engineering talent to build comparable systems in-house, so they are turning to Standard Cognition to help.
Referring to this type of disruptive situation, Ohanian said, “We haven’t seen it happen yet for these communities, these retirement centers, but it’s only a matter of time.”
Easing the caregiver shortage
While technology holds potential to substantially reinvent the senior living experience, Ohanian does not anticipate that robots will replace human caregivers.
In fact, he believes that caregivers are less replaceable than many other types of workers. He is “shouting from the rooftops” to encourage people to join the caregiver workforce in the coming years.
Robots are simply combinations of hardware and software, not necessarily humanoid C-3POs, Ohanian pointed out. And robots can perform routine tasks better, faster and cheaper than humans can. It’s these routine tasks in senior living and care that robots will excel at, in his view.
“You can imagine better technologies to, say, identify if someone has fallen in their room or their heart rate changes in their room, and that’s something that robots — hardware and software — will continue to get better and better at, and that humans shouldn’t really be doing — it’s an inefficient use of humans time to sit in a room and just watch a person,” he said.
On the other hand, robots are not good at non-routine tasks, such as forging an empathetic human connection.
“Empathy is the most extreme end of a non-routine task there is, because it requires creativity, it requires humanity, it requires things that I personally don’t believe robots will ever be able to do,” Ohanian said.
New businesses can be created to help alleviate the caregiver supply problem by training people in needed skills, and new types of roles — like the Papa Pal — will probably be created, he thinks. And the pool of available labor could increase as other jobs are in fact taken over more and more by robots. Ohanian pointed to restaurant servers as one example, considering that people will be able to use technology to place their orders.
So, senior living and care providers should be thinking in terms of using tech to empower, not replace, their workers.
“Where software excels is being able to store and track lots of things that would otherwise be really time consuming for humans to do, and then give the caregivers the chance to really focus on the things that matter, which is the companionship and the empathy and all the stuff that will always be the domain of humans,” he said.
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Source: Senior Housing News