Wednesday, July 24, 2024

Can Canada Lead In The Fastest-Growing, Most Complex Economy In The World?

We’re experiencing a revolution in aging, thanks to new innovations, technology and breakthroughs in aging science and medicine that are extending lives and improving the health of older people.

An ever-growing number of the world’s brightest, boldest, most forward-looking economists, scholars, scientists, innovators, disruptors and entrepreneurs have recognized the enormous potential these advances in the technology of aging represent. Not only for significantly extending lifespans, but for how it can — and will — create jobs and stimulate economic growth. 

But despite Canada’s ranking as the sixth-largest investor in longevity advancements globally1Investment Digest Longevity Industry 2021, Aging Analytics Agency, our longevity sector still remains a well-kept secret, which prompts the question: Are we taking the aging revolution seriously enough to compete in it, let alone lead it?

Staking Canada’s leadership position in the longevity economy

Researchers project the number of Canadian adults aged 65 and older will vary between 9.9 and 10.9 million by 2036 (double 2009’s numbers) and between 11.9 and 15 million by 2061. The number of people over 80 could reach 3.3 million by 2036 and 5.1 million by 2061. This aging population is expected to pose serious economic challenges, with rising healthcare costs and increased demand for government-funded pensions. 

Thankfully, the world is changing. Instead of being an economic drain, the aging population is giving rise to what’s projected to be the largest industry in human history — an industry focused on tackling aging issues globally — the business of longevity.

Canada has got the talent, the resources and a huge under-served segment of the population with enough buying power to make a major impact in the business of longevity. A 2015 Statistics Canada Survey of Household Spending shows older Canadians spend significantly — and locally — consistent with data from other countries22015 report on world population aging by the Department of Economic and Social Affairs of the United Nations

But are we taking full advantage of what we’ve got? Where does our government stand on the longevity economy? Is it a priority, like it is in the UK, for example, where the All Party’s Parliamentary Group for Longevity (APPG) was specifically established to “address the scientific, technological and socio-economic issues related to aging”? The APPG’s aim is to “turn the ‘problem of aging’ into one of the most promising opportunities of the 21st century — and secure Britain’s place as a global leader.”

Are we similarly ambitious on behalf of our country? What more can we do? Can Canadians organize themselves to become a major player on the global stage? 

Is a Canadian investment in the industry of aging worth it? And is the potential as large as projections indicate?

The numbers certainly point to the longevity economy’s massive, precedent-setting opportunities. A simple Google search of the term nets almost 35 million results. 

landmark study conducted by the American Association of Retired Persons (AARP) reveals that the economic contribution from the 50-plus population in 2018 was worth $8.3 trillion. If 50+ spending was a country, it would be the third-largest economy in the world behind the United States and China. By 2050 that $8.3 trillion is expected to more than triple3The $8.3 trillion figure is the sum total of GDP generated by all industries as a result of the 50-plus population’s existence and participation in market activities (ie it spends money, pays taxes) – AARP Report and The Economist Report.

Joseph F. Coughlin is the director of MIT’s AgeLab, a research organization dedicated to studying the intersection of aging and business. He has been conducting groundbreaking research for 20 years into what older people want. His clear message to business? “It’s no exaggeration to say that the world’s most advanced economies will soon revolve around the needs, wants, and whims of grandparents.”

Then there’s Dmitry Kaminskiy and Sergey Young, two of the world’s most passionate and outspoken longevity gurus. Kaminskiy, a fervent believer in humans being able to live longer and healthier lives, heavily invests in the fields of longevity, precision medicine and artificial intelligence. He has also famously put up a $1 million USD prize for the first person who turns 123.

For his part, among many other initiatives, Young is the founder of a $100 million Longevity Vision Fund and is the development sponsor of the Age Reversal XPRIZE, a global initiative designed to cure aging and age-related diseases.

Big names in the business of aging science like Google’s Calico and Craig Ventner’s Human Longevity Inc., as well as venture capitalists, pharma and public investment vehicles, are also backing the sector. Additionally, the business of longevity is regularly picked as a major topic of interest for panel discussions and entire conference series by top-tier finance and business media outlets, including The EconomistFinancial Times and Bloomberg4Investment Digest Longevity Industry 2021, Aging Analytics Agency.

United States already leveraging longevity

Jeff Bezos is said to be an investor in Altos Labs, a new Silicon Valley start-up working on biological reprogramming technology that could, one day, prolong human life. And DeepMind, the AI subsidiary of Google’s parent company, Alphabet, can now predict the form of nearly every protein in the human body, which could ultimately advance the understanding of numerous areas of longevity research from aging at a cellular level to new draggable targets for diseases of aging.

Other major American players in the longevity sector are introducing innovations at a rapid pace. Apple Watch 4 detects both falls and irregular heart rhythms — a standard feature that automatically turns on for users aged 65-plus — and has been designated an FDA Class 2 Medical Device. 

Uber and Lyft have developed programs to provide rides for older adults through age-friendly web tools, apps and phone systems. And Nestlé has invested in an entire division dedicated to healthy aging.

In 2018, Amazon acquired PillPack, a full-service online pharmacy offering pre-sorted doses of medications. Meanwhile, Alexa Skill developers are creating content strategies for companies that want to engage their elderly users.

Bank of America Merrill Lynch, in partnership with the USC Leonard Davis School of Gerontology, is teaching financial advisors about older people’s experiences, priorities and goals. They’re also training their customer-facing workforce to understand the needs of their aging customers.

These initiatives barely scratch the surface of what Americans are doing to create a stake in the industry of aging. As stated in a report from the Aging Analytics Agency5Investment Digest Longevity Industry 2021, Aging Analytics Agency, a subsidiary of the Deep Knowledge Venture Group, the US already leads the world with $256 billion invested in 12,581 companies.

And by no means are they alone on the longevity and aging bandwagon. They’re joined on the top 10 list by China, the UK, India, Switzerland, France, Israel, Sweden and Germany6Top 10 countries in the longevity sector in 2021, Investment Digest Longevity Industry 2021, Aging Analytics Agency. Canada is on the list with $5 billion USD invested in 841 companies, but what’s the strategy behind the investments? What sectors are represented and how successful are they? 

Canada’s current impact in the industry of aging

We’re sixth in the world in terms of investment, but instead of celebrating our innovators, we seem to be keeping their accomplishments to ourselves. A comment about Canada’s humility made by Paddy Cosgrave, CEO of Web Summit, is telling: “The underbelly of it is that Canada sometimes does a bad job of pumping itself up and selling itself to the world.”

How could we do a better job of selling ourselves at home? Case in point:

Partnering with MIT’s Joseph Coughlin, Canada’s CI Global Asset Management recognized the potential and launched a Global Longevity Economy Fund in 2020. The fund’s strategy is to identify and invest in companies with the potential to serve the needs of an aging, and wealthy, population.

That’s positive news until you consider that only one of the fund’s top 15 holdings is Canadian — Manulife in the financial sector. Canadian companies are absent in the remaining sectors, which include healthcare, technology, consumer services, consumer goods and industrial goods. Just over 12 per cent of the fund’s asset allocation is Canadian.

This small percentage seems odd given the fact that more than 800 Canadian companies are invested in the longevity industry. Undoubtedly, some are start-ups or just at the pilot project stage, but you would think there would be more than one worthy of being considered for investment at the very least. 

Perhaps we should pay closer attention to an article written in February 2021 for the Financial Post by Philip Cross, Statistics Canada’s former chief economic analyst. He concluded that Canada is good at starting companies but not at nurturing them to global stature.

Where Canada is well-engaged — AGE-TECH

AGE-WELL is a Canadian federally-funded network dedicated to developing and delivering technology-based solutions to help older Canadians maintain their independence, health and quality of life. It is making an impact. One of its start-ups, Steadiwear, has created a stabilizing glove that allows people with tremors from age-related diseases like Parkinson’s to perform everyday functions like eating and shaving. It’s a real game-changer.

Like AGE-WELL, Baycrest’s Centre for Aging + Brain Health Innovation (CABHI) is also involved in leveraging technology to combat challenges older adults face. CABHI’s Mentorship, Capital, and Continuation (MC2) program, for example, has launched MC2 Capital in partnership with National Bank. It’s a first-of-its-kind investment program dedicated to supporting early-stage Canadian health tech companies. Interestingly, CABHI also recently formalized a partnership with AGE-WELL.

As further evidence of their commitment and belief in the importance of the longevity economy, AGE-WELL is presenting “AgeTech Innovation Week” in October 2021. International in scope, the virtual event allows attendees to hear what global influencers and thought leaders have to say about Canada’s role today and in the future.

Other Canadian innovations include HomeEXCEPT, which uses smart sensor tags on hundreds of everyday objects to prevent accidents for older adults living at home. Cloud-based home healthcare software for care providers developed by AlayaCare recently received $225 million in an investing round led by Al Gore’s investment firm.  

What’s more, uCarenet has introduced a series of apps linking families to qualified caregivers, allowing palliative patients to be monitored by doctors remotely and to overcome language barriers between aging seniors and caregivers. 

Exciting as these advances are, there’s a lot more to living successfully into our hundreds than physical safety and wellbeing. Our financial wellbeing is vital, and it’s a major concern — not just in Canada, but globally. 

According to a Purpose Investments and Angus Reid survey7Report: “Retirement in Canada”, “half of Canadians aged 55+ are not confident they will have enough money to last them in retirement. And the pandemic has only intensified those fears.” In response, Purpose Investments recently launched the Longevity Pension Fund, the first income-for-life mutual fund designed for Canadians in retirement.

Canada has much to offer, so what’s holding us back from doing more?

Start with the findings of a 2019 Fraser Institute study — Innovation in Canada An Assessment of Recent Experience — the essence of which is this: “It’s widely acknowledged that Canada’s innovation performance has been, and remains, relatively weak by international standards.”

Two Canadian experts weigh in on why Canada is lagging behind.

BEworks is a behavioural science consultancy and think tank, dedicated to understanding why we make the decisions we do. To understand that, they work with leading academics in psychology, neuroscience, economics and marketing, as well as business management experts. Two members of their team, CEO and co-founder, Kelly Peters and Research Institute president David Lewis, have some interesting theories on Canada’s place in the aging industry.

They suggest that “those who have not yet seen the light may base their strategies, how they evaluate opportunities and decisions on traditional market analysis, which is based on demographic segmentation.” 

They go on to explain that evaluating market potential that way is “wrong because it’s biased. It’s skewed, it’s outdated, it’s based on misinformation.” As David Lewis says, “It treats everyone 50-plus like we’re a homogeneous group, and it’s just not true. Fifty-plus is an incredibly wide band — way too coarse a heuristic for forecasting the future economy.”

“Simple, age-based segmentation is a waste of time,” he adds. “Combine that with approaches based on ‘generational cohorts’ and we move into offensive territory — ageist conversations — such as, ‘let’s make this technology so easy that even grandma can use it.’”

What we don’t know about our aging population can hurt us

For Peters, the answer is clear. She has said: “The traditional demographic-based approach needs to be replaced with more nuanced, less biased, less simplistic approaches and more emphasis should be placed on behavioural modeling and behavioural segmentation. Then we can begin to factor in a myriad of more reliable, more valid, more predictive ways of understanding people’s appetite for adventure, different kinds of risk, how and where they want to live, the products and services they want and need.”

There would also be a much greater understanding of the issues surrounding the health, safety and independence of older people that concern their families and their doctors.

For Canadians, who have a history of being more risk-averse8Press Release: “Wanted: Canadian business leaders who innovate” and less likely to take chances than Americans, you would expect having truly meaningful, more accurate data in our arsenal would drive more of us to join the revolution and capitalize on the longevity economy before it’s too late. 

For that matter, behavioural modelling and segmentation should be undertaken everywhere, even in countries more advanced than we are. Because lest we forget, according to the AARP study, “for every dollar spent by households in 2018, 56 cents of it was attributable to the 50-plus population — and their impact will only increase.” 

Where do we go from here?

There are many other theories and thoughts to explore, discussions and debates to be had, and a lot of questions that need to be answered — not the least of which is, are we limited because so many of our large corporations are headquartered in the US and elsewhere?

And then there has to be an acknowledgment of the human capital value of older adults. As stated in a 2019 Environics Analytics paper, there’s a recognition that there is a substantial market for innovative products and services to serve the needs of this growing population. 

It’s not being referred to as an aging revolution without reason. Capitalizing on the longevity economy isn’t without its challenges. It’s by no means simple. But for those who seize the opportunity — as many globally already have — the business and economic potential is enormous. There’s no debate as to whether this consumer segment deserves more attention from Canadian media and marketers than it’s getting. 

We can be a leader in what’s being touted as the “world’s largest industry” by Dimitry Kaminskiy and Margaretta Colangelo in their book, Longevity Industry 1.0, but if we wait much longer to have this critical conversation, Canada risks being left behind instead of building on the success we have already achieved.

  • 1
    Investment Digest Longevity Industry 2021, Aging Analytics Agency
  • 2
    2015 report on world population aging by the Department of Economic and Social Affairs of the United Nations
  • 3
    The $8.3 trillion figure is the sum total of GDP generated by all industries as a result of the 50-plus population’s existence and participation in market activities (ie it spends money, pays taxes) – AARP Report and The Economist Report
  • 4
    Investment Digest Longevity Industry 2021, Aging Analytics Agency
  • 5
    Investment Digest Longevity Industry 2021, Aging Analytics Agency
  • 6
    Top 10 countries in the longevity sector in 2021, Investment Digest Longevity Industry 2021, Aging Analytics Agency
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Fransi Weinstein
Fransi Weinstein
A former Montrealer, Fransi enjoyed a long and fabulous career as an ad agency writer and creative director. After deciding she wanted to completely switch gears and turn her love of storytelling into writing articles – as well as wanting more time to blog and work on a book, she gave up her full-time career to go freelance in 2009. Since then, she has written on everything from politics in Huff Post to speaking out in defense of animals for Get Leashed Magazine and age issues.