Digital health startups that are targeting the aging population, 50 and over, more than doubled their funding in the past three years, increasing their funding from $413 million in 2010 to $928 million in 2013, according to a report sponsored by AARP and StartUp Health.
The partnership and report development is part of AARP's Innovation@50+ initiative, which aims to increase awareness that certain tools are needed and wanted by people 50 and over. The initiative was launched in 2011 but AARP's partnership with StartUp Health was announced in April.
Overall, the pace of growth for startups that target the 50 plus population kept pace with the total funding growth for digital health and wellness companies, which grew from $958 million in 2010 to $2.29 billion in 2013, and was mainly comprised of seed or series A rounds (73 percent). While the deal count for total digital health and wellness companies tripled, the deal count just for aging populations grew six-fold, from 24 in 2010 to 153 by the end of Q3.
Other countries are also starting to notice a growth of aging populations. At the mHealth Summit event in Washington D.C., Director of the Qualcomm Life fund, Jack Young, said in Japan, adult diapers are outselling baby diapers. Back in the United States, Young notes that the aging population is catching up with Japan's and that startups will begin to make more products that address this growth.
"There’s a service called home care which is enjoyed by something like 3 million seniors in the United States," Young said. "Typically they cost you $20 an hour...but by the time you and I retire, I don’t think it’s going to be close to being $20, it’ll be a whole heck of a lot more. So what that means is, I think the only way to solve that is technology."
According to the report, vital sign monitoring had the largest median deal size, at $2.76 million. The report points out that this kind of startup will be best utilized by those with chronic conditions, which 78 million consumers over 50 currently have.
The report found medication management was the newest opportunity in the over 50 market and estimates 70 percent of people 50-64 and 87 percent of people 65 and older take at least two medications. Notable deals that the report highlighted included Medisafe Solution's $1 million seed round and ZappRx's $1.16 million seed round.
Only 10 to 30 percent of the 50 and over population would be interested in the behavioral and emotional health market, but the report found this was where the highest proportion of early stage deals took place, at 94 percent.