The Business of Longevity

Last month, I finished teaching a new course at London Business School – The Business of Longevity. It was a 10-week course packed with fantastic guest speakers covering multiple aspects of the longevity economy. Below I share some of the details and a few reflections arising from the course.

As far as I know this and Laura Carstensen’s Longevity: Business Implications and Opportunities at Stanford are the only business school courses specifically focused on longevity rather than just the growing number of older people. Through a weird twist of scheduling fate both Laura’s and my course ended up being taught at exactly the same time on the same day of the week. Hopefully that was the universe finding a way to amplify the message.

Why teach a course on Longevity?

In launching the course I had several motivations. The first is that I know from my own writing and speaking that more and more individuals are aware of the opportunities and challenges longer lives bring. There is also a rapidly growing number of researchers and investors providing momentum to geroscience. Even governments are beginning to respond as they start to shift from the more negative perspective of an ageing society to a more positive longevity agenda. All this is great but longer healthier lives require new products and new services and that means the message needs to spread to businesses. We need more entrepreneurs creating start-ups in this space and more people working in large corporations who understand the potential for this market and the career opportunities it offers. Several initiatives already exist– the long running Ageing 2.0, the US National Academy of Medicine’s Healthy Longevity Grand Challenge, the UKRI’s Catalyst awards, Zinc VCs Quality of Later Life challenge, etc. Running a business school course seemed an obvious way to generate additional momentum and create a cohort of future business leaders informed, committed and excited about the opportunities.

Setting up a new course is also a great opportunity to take stock and think. The business of longevity is a broad topic and an emerging one. It is growing rapidly so this seemed a good time to provide some structure and framework to it. Because of this emerging nature it was a lot of work to set up. There aren’t conventional case studies to draw upon, established textbooks or canonical business models and that made it an exciting course to develop and one which will clearly evolve in the years ahead.

In deciding what to include I set a few key principles. The first was the main focus had to be on business - the potential of new areas as well as what existing firms and markets need to do. The second was to go broad – to cover the science and biotech side of longevity but also to include finance, work, F&B, FMCG, social entrepreneurship, etc. Importantly whilst the longevity agenda is a positive one the course also had to cover difficult topics such as dementia, loneliness and care. This was a course about all of life including but not exclusively end of life. The third and final principle was that whilst the focus was to be on business I wanted the students to go through a personal development too. I wanted them to think about their own futures, their views on ageing and being old and how they thought about their parents and the community around them.

This connects to another motivation. Invariably when I am asked to speak about longevity most of the audience is aged fifty and over. The opportunity to interact with a younger audience and find what made them relate to the topic was a major motivator.

The student feedback suggests they learnt a lot from the course. I certainly did. One thing thing I knew already but which was heavily reinforced was just how many wonderfully smart and generous people there are working in this space and how dedicated they are. I am enormously grateful to the large number of people who despite incredibly busy schedules and a timetable that meant the course ran late on a Monday evening were all prepared to give of their time as guest speakers, share their insights and take time answering student questions. Sincerest thanks to Mehmood Khan, Andrew Steele, David Sinclair, Jim Mellon, Dani Saurymper, James Peyer, Joseph Coughlin, Stephen Johnson, Surya Kolluri, Katie Tryon, Deb Whitman, Greg Bailey, Andrea Berchowitz, Dexter Penn, Seth Sternberg, Alyaa Abdulla Mohamed Al Mulla, Marc Freedman and Laura Carstensen. The students were suitably amazed at the insights and knowledge you shared. Thank you to them all.

The London Business School “Business of Longevity” Pioneers!

What did we learn?

1.????People are interested in the topic

I really didn’t know how much interest there would be in this course. It is a very different course from the rest of the London Business School elective portfolio with its understandable focus on popular finance, strategy and entrepreneurial courses. Being an elective students had to use one of their credits and choose to take it. Reassuringly the sign up was great and the course filled to capacity.

The course appealed to students from across the School’s postgraduate degrees. That means from our ‘pre-experience’ programs, such as our Masters in Management, who are mostly straight from undergraduate degrees as well as MBAs, Executive MBAs and Sloan Fellows. As a consequence, students ranged in age from early 20s to early-50s which helped to create some great classroom conversations. There was also a fantastic global mix with participants from 30 countries, from high to low income nations. Longevity and ageing are clearly global issues.

Student motivation for taking the course was similarly broad. All sectors were represented – health, pharma and care as well as finance, consulting, manufacturing, real estate and consumer goods. We had longevity hackers attracted by sessions on the science and biotech and keen to swap tips on fasting, metformin and rapymycin. There were several who were already working in the area and dealing with the needs of an ageing population in their own country and many who had a preliminary idea about launching a startup. There were also those attracted to the topic having read “The 100 Year Life”. But there was also those for whom this was a totally new area that they felt was important to know about for both personal and professional reasons. They were looking for something different and new as they look to embark on the next stage of their career and were keen to find about new areas with high growth potential.

2.????It’s a huge market

I spend a good part of my working day looking at data and quoting statistics. Sometimes though the numbers are just that – numbers. You don’t always recognize the sheer magnitude of them and what they represent. So sure, there are over 700 million people in the world currently aged over 65 years and that will more than double in the next thirty years. I have read countless times about the business opportunities of a ‘silver’ economy and how the AARP calculates the longevity economy is worth over $9 trillion dollars today rising to $28 trillion by 2050. There is also my own work with Martin Ellison and David Sinclair that calculates that for the US alone if we could improve how we age such that life expectancy increased by one year that is worth $38trn.

But these are big aggregate numbers that capture everything. Each week of the course was focused on a different sector and so broke this number down to its individual building blocks. We heard from Mehmood Khan how the The Hevolution Foundation has committed to invest a $1bn a year in longevity science. Earlier in the year Altos Labs announced $2.2bn of funding. Whilst that’s small compared to overall annual Pharma R&D of $83bn it is still a huge amount of money. Listening to the growing confidence of scientists working in the area (and their confidence is striking) it is not hard to see how this could lead to major new revenue products in the pharmaceutical sector.

But longevity goes far beyond the traditional health and pharma sector. The global food and beverage industry is worth over $6trn and what we eat and drink has a massive impact on our health and longevity. Finance is another huge industry with the global pension industry worth more than $50trn. Retirement is changing dramatically and that means major changes in pension provision. Life insurance and health insurance are converging for several innovative providers as longer lives become a reality. The US care market is estimated to be worth $457bn in 2021. Every week in a different sector the scale of this longevity and ageing market was apparent and we heard about firms starting to respond to the challenge.

3.????Schr?dinger’s market

The beginning of the course focused on the biology of ageing and associated biotech firms and investment. This is obviously a business whose sole focus is on (healthy) longevity. It is about finding therapeutics that will help us age better and live healthier lives for longer.

That aim of achieving healthy longevity was common throughout every session and every sector – whether it be health and food, pension and insurance, work and careers, care and dementia, etc. All of them are looking to create the products, services and behaviours that support healthier productive and engaged longer lives. But because the market is so big and covers so many sectors it is sometimes hard to get a bearing on the business of longevity.

Looking at the aggregate statistics it is clear that longevity is up there with sustainability and AI in terms of a transformative trend firms need to engage with. But once you look more closely the longevity theme gets scattered across many different topics.

The physicist Ernst Schrodinger invented a famous logical puzzle about a cat locked in a box where it is logically indeterminate whether the cat is alive or dead – it is both. Longevity feels similarly indeterminate right now. Is it a topic in its own right or just a background theme for everything? In other words, is it a business vertical or a business horizontal? ?In the biotech sector it is on a path to be a well-defined vertical but elsewhere things are more complicated.

For instance, if there is a huge amount of money to be made achieving healthy longevity then investment funds focused on longevity make sense. But where would the remit of a longevity investment fund end? It certainly involves health and pharma. Definitely education and life long learning. Also real estate. F&B. Finance. That’s a broad based fund for sure with not much left out.

Some of this lack of identity arises because longevity is at an early stage. Jim Mellon, Chair of Juvenesence, has a neat phrase where he says the longevity sector is currently like the dial up stage of the internet. Many companies just aren’t aware of how important this area will be to them and how it will lead to major changes in the products they offer. Incumbents naturally start thinking about change based on where they are rather than where they need to be. In other words, they approach innovation like the proverbial person looking for their car keys under the street light rather than where they lost them. The result is that in many companies a focus on healthy longevity has to emerge within existing verticals but may not be given enough focus.

I suspect (and there was evidence from plenty of speakers) that all this will change. The pensions and insurance sector will start to develop a vertical around dealing with longevity risks and supporting longer lives. Pharma will shift from just focusing on diseases to thinking about ageing. The food and beverage sector will start to develop departments focused on health and healthy ageing. The educational sector will start to provide courses for older adults aimed at supporting longer careers. But we also know that healthy longevity is about all of life. As Joseph Coughlin stresses, designing good products for older people is ultimately about designing good products. Longevity will develop more and more as a theme and a vertical across multiple sectors but it won’t fully throw off its Schr?dinger’s market feature.

4.????Finding the Market and the Platform

Size and scale aren’t the same thing and business loves scale. The longevity market may be huge but true to its Schr?dinger nature it often hides in plain sight and so far hasn’t readily opened up scale solutions. Business therefore needs to do two things. The first is identify what this market is (who is it? what products?) and the second is to generate scale outcomes.

Identification is tricky. There may be over 700 million people around the world aged over 65 years but how much do they have in common? Ageing is a diverse process and identifying common needs isn’t easy. It becomes all the harder when firms design products not listening to the needs of older people but based on simple minded stereotypes. As always MIT’s Joseph Coughlin has a sharp way of putting it – firms too often design products for older workers assuming health and sickness is all that concerns them. Just as firm’s don’t think that the teenage market is only about acne treatments they shouldn’t think products for older people are all about physical decline.

The trouble is that firm’s get interested in this market based on statistics such as the number of people aged over 65 years. But that market doesn’t particularly self-identify as an over 65 cohort. The result is a disconnect. The market may be huge but firms struggle to find it. That’s not helped by a number of supply driven innovations – with entrepreneurs believing that their product is what older people should want. The logic is often sound but it isn’t always attuned to market research.

This links into the challenge around scale and establishing a platform for longevity products. Whenever anyone mentions scale it isn’t long before an App is proposed. Whilst older customers are increasingly digitally comfortable creating a platform needs to go wider than just an app. Honor’s CEO Seth Sternberg was focused on how qualified care attendants who regularly attended to people’s needs in their house could serve as a trusted gateway and therefore create a platform for a range of services that would tap into this huge market.

Wrestling with the market identity and then creating the platform is the race that the most innovative start-ups and forward-looking companies are focused on. Success will generate unicorns and market momentum. The problem hasn’t yet been cracked but given the size of the reward the race is on. Business is beginning to accept the size of the market and is now searching for ways to create and serve this market at scale.

5.????Across the Ages

It was great to talk about longevity with a younger age group than usual. I think its hugely important to draw a distinction between an ageing society and a longevity society. The former focuses on the fact there are more older people than young. The latter focuses on the profound change whereby today the young and middle aged can expect to become the old. The former is called the ‘silver’ economy but it is the latter, which I call ‘the evergreen’ economy, that I think is most important.

I was delighted that this evergreen concept resonated with younger and older students alike. Over the course of the class we began to move away from simple distinctions about the young and the old. Discussion became more nuanced and reflected the diversity of how people age, how the old aren’t as old as they used to be given longer lives and above all how the young and middle aged need to prepare for when they get old.

Of course, it wasn’t all plain sailing, cultural concepts about ageing are deeply ingrained. In discussing how gyms or cinemas could cater for an older audience several students just assumed that over 50s weren’t working and would visit during the day. Similarly, when raising the urgency of the challenges facing older people it was obvious this needed to be discussed with the equally dramatic challenges younger generations face around housing, finances, job security and raising a family. The norms and practices that we established to support ourselves over the life course aren’t working well at any age given the increase in life expectancy that has been achieved and it’s a collective generational challenge to reform them. Thankfully we had Marc Freedman to powerfully point out just how important these intergenerational links were.

Many of the students were passionate before the course about the topic and wanted to work in this area. Others I think became passionate and saw the importance and the appeal of the area. Then there were those who just saw it was important and there was a huge area of human need that wasn’t being met which created a great business opportunity. Whilst I love the passion of those dedicated to this area I do think the latter group are going to be crucial. It is when promoting healthy longevity becomes conventional and business routine that success in meeting the longevity challenge will happen.

6.????It’s Happening…

There are few trends as important as how humanity adapts to the length of life we currently expect. It really does change everything. But this was a course focused on business. Business may be motivated by the big picture but it is most interested in just getting things done.

What is clear is that things are happening. It may be early stages but in a multiplicity of sectors a number of firms, from big multinationals to scrappy start-ups, are making things happen and beginning to mobilise. The rapid growth in bio-tech is an easy example to point to as it crystallises so clearly the importance of exploiting the malleability of ageing. Success there requires smart ideas, reforms to drug trials, new forms of financing and new drugs and supplements. That is all happening. Financial markets need to find new ways to encourage savings, offer longevity insurance and incentives to maintain your health and find ways of protecting the vulnerable. But as we heard from Bank of America, Merril Lynch, Discovery and Vitality companies are starting to do this. We heard from successful startups delivering products aimed at improving experience of the menopause (Vira) or protecting bank customers from cognitive decline (Kalgera). This sector is emerging. It is no longer just a clarion call uttered at the end of a conference panel but is becoming a reality. From sector to sector there is a sense of experimentation and growing confidence of success and something important building.

The course is over now so I have my Monday evenings to myself once again. I do look forward to running it again next year with a new cohort of students and when I am sure I will find the business of longevity has developed even further. The course will certainly evolve both because of these developments and from what I learnt during the course itself.

As well as the guest speakers I also have a great bunch of students to thank. They were open minded and inquisitive as well as tolerant of a new course running for the first time. They even took me missing the first lecture due to Covid-19 with good grace. They also seem genuinely enthused and interested in the business of longevity with many of them looking to pursue this area further. If we are to respond to the opportunities and challenges that longer lives bring we need to transform how business approaches longevity. ?I wish this first cohort of students every success in bringing about that transformation.

For more about Andrew’s work on longevity and its implications please visit www.profandrewjscott.com and www.thelongevityforum.com