433. Founding VC Firms Apax, Greycroft, and Primetime, the Keys to Unlocking Investment Value in Healthcare, and Why the Aging Population is the Biggest Opportunity in Tech (Alan Patricof & Abby Miller Levy)

433. Founding VC Firms Apax, Greycroft, and Primetime, the Keys to Unlocking Investment Value in Healthcare, and Why the Aging Population is the Biggest Opportunity in Tech (Alan Patricof & Abby Miller Levy)


Alan Patricof & Abby Miller Levy of Primetime Partners joins Nick to discuss Founding VC Firms Apax, Greycroft, and Primetime, the Keys to Unlocking Investment Value in Healthcare, and Why the Aging Population is the Biggest Opportunity in Tech. In this episode we cover:

  • Launching a Horizontal Fund Focused on Ageing Population
  • Investing in Businesses Catering to Aging Population
  • Healthcare Investment, Regulation, and AI’s impact
  • Reducing Healthcare Costs Through Prevention and Engagement
  • Healthcare Innovation, Monitoring, and Diagnostics
  • Reaching Older Adults in Healthcare, Including Marketing Strategies and Challenges

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Transcribed with AI:

0:18
Alan Patricof and Abby Miller Levy join us today from New York, Alen and Abby co founded Primetime Partners, an early stage venture capital firm that incubates and invest in the people and companies that transform the quality of living for older adults. Alen, of course, needs no introduction. Prior to primetime, he founded firms Apex in 1969, and Greycroft in 2006. And Abby was founding president of Thrive global alongside Arianna Huffington, and was SVP of strategy and growth for SoulCycle. Alen and Abby, welcome to the show.
0:55
Great to be here, Nick.
0:56
Awesome, great to have you both. Maybe we’ll start with Alan, Alan, give us a little more colour on, you know, your backstory founding to VC firms and why you decided to do this under a new banner? Well,
1:08
when I started in the business, and really it was December 69, so let’s call it 1970. There really was no venture capital industry and I had recognised the need and high net worth families for some advice in the private investment area, which inevitably, everybody got to but in a very backhanded vanishes, almost everyone was focused in virtually entirely public securities at that time, including the family that I had worked for not mine. And I had gotten intrigued with the few private investments that we were making, and got more involved with that because no one else was interested in. So I decided to go into a business advising families on their private investments and bringing deals to their attention and helping them vet ones that people brought to them. And they didn’t know what to do with. And they started out with two and a half million dollars, built it up over many years from New York to California to Europe, to Southeast Asia, to the point where it was a really multi continent firm, with a lot of people working for it. We had 12 offices, and we had inexorably morphed into a private equity firm, which at that time was when I left was running close to $10 billion from from my first fund of two and a half billion, it got to 10 billion. But it was almost all private equity, no one had really interested in doing small deal. And I decided to take off and do something else with my life. I spent three or four years pro bono working for the World Bank and the IFC and helping the developing world then I decided in 2006, it was time to start a new venture firm. And I started, again, small 75 billion, with the idea of staying small. And over the next 1615 years, we also got bigger, and the great craft became more of a growth firm, and had less interest, although some in the venture business or venture school deals comes very difficult to do when you get up to 3 billion in management. And so I had been thinking a lot about what are the things I might do before my life business cycle ended and I had been my wife had Alzheimer’s for 12 years. And I had been living through it. And I learned a lot during that about ageing and wellness and going to conferences and read studies and realised that fastest growing part of the population were the people over 60. And we’re going to be certainly, and that we were just getting into this concept of longevity. And by sudden one day would go to Harvard Business School with Abby said, you know, Abby, you’re talking about this ageing, ageless economy and the opportunities and you’re doing nothing about it. Abby, who you know, because Abby was the president of Thrive and I invested in thrive on behalf of Greg crop because I had invested in Harry on his previous company, Huffington Post, and he said you want to talk to me. The next day we got together, we had breakfast, the three of us. And it was so clear that we both spotted this incredibly emerging trend that was kind of kind of whitespace I would say, I want to say you’re never the only one everybody to a certain degree that, you know, trickled into the space. But we both had this very focused attitude of creating a firm that would invest in products, services and technologies that serve the fastest growing part of the population, not the millennials but the baby polymers and all the other ages, other categories that go along with that. And about a month or two later, Abby and I formed a prototype, and the name conveys what we are doing. We’re going after people in their prime time. And I will let Abby take it from here. But what we did is create a kind of unusual firm, and Abby can give you the background of where we think it’s distinctive.
5:24
Perfect, perfect segue. And then Abby, can you tell us just a bit about your background? We’ve touched on a few things. But how that led you to founding the firm here with Alan? Absolutely.
5:33
But first, I need to give out on the proper props. Because he’s being a bit modest. Alan is often his moniker as the father of venture capital. He France gave him the Elysian donnera award for bringing venture capital to France. He was in the first class of awardees by the National Venture Capital Association, as the kind of leaders in the space. So I am definitely the beneficiary
5:57
of the throw in what the title of the speech I gave at it upfront, a month ago.
6:02
I think it’s better coming out of your mouth Elon than mine,
6:06
what the eff am I still doing this? That’s
6:09
pretty good. Exactly. So when I got the idea for starting this fund, which I’ll come to in a second, and my friend John Patricof, told me that my former investor and in my former company was interested in the same space, it was a no brainer to combine my background in marketing and ops with Alan’s 50 plus years as an investor to apply that complementary skill set to what we believe is the biggest mega trend globally, that investors should be taking a look at, which is ageing. But as I mentioned, I spent most of my career in operating roles starting you know, after after McKinsey and Business School, which are kind of the educational part of my career, at a leading product of the company called Oxo International, which was a small business at the time is now a billion dollar consumer products company. And I spend about seven years working with a variety of brands always on business growth and marketing. Before joining Arianna Huffington, as Ellen mentioned, to start Thrive global after being a founder for few years, join SoulCycle to run our digital at home business, which you know, involves taking up peloton which was really fun. And then while I was there started a personal project, a deep dive of research into what happens in this country in our 60s 70s and 80s. And beyond. And so trying to really understand the landscape across healthcare, financial services, housing, workforce, etc, for an ageing population driven by my own experience with my father. And so that brings us up to date, till spring of 2020, when Alan and I decided to launch primetime. And as listeners will recall, spring of 2020 is also when the world stopped due to COVID. So it was a really interesting time to fundraise logic fund to begin investing.
7:50
Amazing. So I’d love to jump in on the thesis and some of the details here. Before we do that, Alan, if you had to pick one thing that you’ve done differently, this time when launching the firm in the funds, aside from thesis, of course, what’s the biggest difference? You know, what’s the biggest change you made when launching primetime? From the previous two?
8:12
Well, I think I’m right, giving the credit really to Abby. But however it’s happened. We have launched what we call a horizontal fund. And every other fund that I know of, I’m sure there’s somebody who has who sent me a note who maybe is listening will say, you know, me too, we decided to launch a horizontal fund. And you think about it, everybody starts a FinTech, consumer fund, a health care fund, a Climate Fund, you name it, they focused on an industry. Abby and I were going to focus on the market, rather than what discipline people are doing. So we are a horizontal fund. And we call ourselves a horizontal foam, which means that we don’t care if you’re in FinTech or health care or your consumer climate or whatever you are, if your customer, your consumer, whether it’s business or individual, if they’re isolated, which takes the ABI says over 50 But you know, an older person, it’s like porn, you know, when you see an older consumer of some sort, we want to talk to you. So our portfolio Well, it has a greater, much greater concentration in health care. And secondly, in FinTech. It also has done a couple of consumer deals. And if someone came us came up with a climate company that only took care of climate control to 60 people we would look at that I assure you, but we are across quest across the spectrum. So I’d say that’s difference everything else before it was kind of focused on industries. Very
9:50
good. And then Abby quickly broad strokes on stage checks, eyes, willingness to lead deals versus going best. Absolutely.
9:58
You get as an interesting point where we raised a $50 million seed to series a fund and deploy that capital and 39 months into 36. Businesses were in the process of both raising and investing fun too. And the shift there is really, you know, minimal, same team, same thesis, same approach. But with higher concentration, because we’ve learned so much in the past four years of what works and doesn’t work, that we can have greater conviction. So fun. One was 50 million, you know, into 36. Businesses fun two will be closer to 60 to 75 million into 20 to 25 businesses, which means the cheque sizes will be larger associate checks of you know, one to one and a half million and series A plus check sizes of two to 3 million. And you know, we’d love to we’re happy to lead. But you know, in every one of our deals, we really believe in putting together the right syndicate we’ve co invested with at other funds. In fact, two thirds of our deal flow, look at about 600 businesses a year to two thirds of our deal flow comes from other venture funds, because of our subject matter expertise. As Alan alluded to all the vertical funds, you know, flip us deals because there’s a hey, what’s primetime think about this, because when you can go deep on a thesis, you really have an advantage in terms of diligence. Very good. So,
11:18
you know, the US population is older today than it’s ever been. The number of Americans aged 65 and older is projected to increase from 58 million in 2022 to 82 million by 2050. And the 65 and older group share of the total population is projected to rise from 17 to 23%. So there’s some obvious tailwinds based on these demographics, what would you say is the biggest headwind or what’s the biggest challenge to building a fund focused on this thesis?
11:46
I think the biggest hurdle we talked about the tailwinds in one for one second before going to the headwinds, I think it’s not just the demographic shift is the implication on every area of our economy. And so we get often asked this a lot, you know, hey, do regulatory headwinds, and we have regulatory tailwinds. That is because Medicare is growing at 8.4% a year going to be 50% of our federal budget by 2060. Secure act 2.0, which puts pressure on employers to offer retirement savings accounts 401 Ks, there’s a lot of really great support for building businesses in this space, because we are so unprepared as a global society. And so if I flip that around, if I see what the tailwinds are turning the headwinds are what to end is that for now, the majority of businesses are relying upon enterprise or corporate contracts to grow, there isn’t really yet an advanced direct to consumer market. And that’s not because older adults aren’t online, two thirds use social media, they are 60% of the global spending adults 50 Plus it’s not because they’re not spending it’s not because they’re not online. It’s because they’re not aggregated in the same way, you know, if you’re a marketer looking to reach someone 20 to 25, Instagram, Tik Tok, you know, you know exactly where to go. And these are just newer audiences to reach. So I would say that’s one of the things we’re seeing with our companies is that those that are going direct to consumer are really having to build new marketing playbooks, a business like Cowell, which is DTC and it’s an E commerce business focused on family caregiving. They’re figuring out new ways to reach this audience. And it’s just takes more time when it’s hasn’t already been built before. But we’re seeing that shift, we’re seeing a shift, you know, before our own eyes, but I would say that’s one of the things that we’ve we’ve encountered in our businesses are working through,
13:39
I would agree completely with what Abby said, I could throw in one other thing, which is, what she’s saying is it’s tough to consumer. So most of our portfolio is really enterprise related. Then conversely, I would say, like at the enterprise area, the thing that I’ve learned, almost everything starts with a pilot. And it’s frustrating pisses me off, frankly. And sometimes when the pilots are sick, even when the pilots are successful, the health plans or whoever’s involved, you know, wants to delay. So it’s not where you can get a customer and the next day, you’re in business and on a commercial basis. So takes a little longer. But we have lots of companies who have gotten to the pilot stage, but you have to live through that.
14:28
It’s part of it’s it’s called pilot itis.
14:31
We’ve seen it too. I mean, you know, let’s talk more about health care. We look at businesses, we look at the codes closely. You know, how much time do you spend thinking about future codes that will be introduced? Aba, you had mentioned regulation before? And, you know, are there any ties with the legislature in any efforts to sort of positively impact healthcare reimbursement and codes for Medicare and or Medicaid?
14:55
I would say it’s a bit I’d say, the regular regulatory Our bodies are our friends. I mean, every day, there’s a new code that comes out. And that creates an opportunity for someone. And we’ve got we’ve been the beneficiary of that many instances. Absolutely.
15:10
And I would also add that, you know, the enterprises aren’t any further ahead of us. And understanding this, I was recently with the head of strategy of a very large Medicare Advantage pair, and they’re on their back feet, you know, you know, we acting is as much as anybody. But one of the things that’s been different about our focus is that, you know, we go beyond just the investment world, we do spend a lot of time with being a thought leader and connected with other thought leaders, especially on the topic of ageing, government bodies, community based organisations, philanthropy, these are all very involved in the topic. And so one of the areas where we’re seeing a lot of push on regulation is family caregiving. You may or may not be aware, but there’s about 50 million unpaid untrained family caregivers in our country. These are not professionals. These are family members taking care of family members. And largely due to a push by philanthropy, most notably Melinda Gates at Pivotal, there has been increasing pressure for figuring out how to train and pay family caregivers. And so one of the things I think is really interesting is not just reacting and making sure that we’re, we’re close enough to understand the codes, but also being aligned with organisations that are pushing the thinking. I was just at a two day off site with a small group of leaders in the space, including the head of policy from AARP. And AARP is the Juggernaut in the space and understanding what their agenda is, and helping to shape that agenda is something that while not core, everyday actions from a venture fund, actually becomes something that is on our agenda. So when you asked Alan, what’s different between this fund and his other funds, in addition to being a horizontal fund, I would say it’s the level of thought leadership that primetime has both sought out and is being asked for, relative to pretty much most other venture funds that that Al and I’ve been a part of are associated with, love
17:06
to hear that, you know, just in my own personal experience, spending time with family members that are older, I hear words like invisible and overlooked and not cared about frequently. So elevating the exposure and the focus on this group is really important. curious to hear still on the health care point, you know, many issues in healthcare are pretty well documented and discussed. What do you think is the biggest issue with the US healthcare system that far too few people are talking about
17:32
how much how long is this podcast? I think one area that we’re very interested in, that is not often talked about is post acute care or kind of care for older adults, once they’re out of hospitals. This is typically for the polychronic. They’re in and out of nursing homes, hospitals, their home. And this whole fragmented world of home care, hospice, nursing homes, it’s very fragmented. Typically, the domain of either small business or P E. Venture hasn’t historically had a role in this part of healthcare, and COVID. Change that because they brought telemedicine into a reimbursable paradigm. And thus, venture capitalist said, Wait a second, we think we should figure out care in the home. This is not just this is it doesn’t have to be a low margin meat, it often is, but doesn’t have to be a low margin business owned by homecare agencies, which we have no part of. So I think that’s an area that is broken. It is fragmented, but technology is starting to impact this space. And so that’s where I think venture is starting to get interested. The second space is dual eligibles. dual eligibles is the crossover between individuals who are old enough for Medicare 65 Plus, but are low income and are met and qualify for Medicaid. And this population is growing from 11 million Americans to 30 million Americans over the next 20 years. And it is a very complicated problem to solve because you have two government systems that don’t interact Medicare and Medicaid. partially responsible for one human’s life one human health care. And you can imagine how many challenges that invokes and so this is also an industry, this area of Medicaid and seniors that is starting to attract some technology attracts some vendors and therefore tracks and venture interest.
19:30
You know, we’re seeing tremendous amounts of venture dollars invested into AI first companies, are you aggressively investing into AI companies? Why or why not?
19:40
I’ll take a shot at that Abby. chance to think about her. Her reaction. I was on CNBC two weeks ago. So my position is has been made public. We are not investing in AI companies. Let’s put us a we have not seen an AI company that’s dealing with our area. However, I And my general comment was, which is for everybody unrelated to primetime, I’ve been through so many cycles of so much excitement and irrational exuberance about so many areas of our society, particularly in technology, and everybody gets excited, things get way overpriced, then there’s some period of great disappointment and collapse. And I don’t think AI is going to be any different. Some of the, I think the excitement around AI is definitely gonna be it really is. And I really do believe it has enormous prospects for every area, including our area. But for a pure straight AI company, it’s not for us, I think the valuations, we’re gonna see, there’s gonna be a lot of dead bodies around and there’s gonna be a few winners, but I just, I’m not the type to invest in something that 83 billion free money, with no revenues, no matter how exciting it is, I just, you know, that’s not my world, however, that all that said, AI is creeping into our area. And maybe Abby will say it’s more than creeping, but we have at least we just put out a newsletter to our investors, just to because we know they’re all interested. And lo and behold, at least 10 of our companies in some way or another, already using AI, and what they’re doing, and they range from all different aspects of the markets that serving. So AI is going to be something that’s going to have huge impact, certainly in the biotech area with that, we’re not it, we don’t do anything that requires FDA approval, no biotech, no pharmaceutical, no devices, but it’s going to have enormous impact in those areas. And in our areas, it’s going to help people do things more efficiently. And being I was on the phone the other day with one of our companies, which produces software, for rehab centres and nursing homes, senior facilities, to help them reconcile just we talked about coding, so they don’t take 57 days to get paid. But they have a tech technology of how to reconcile coding. And they can get paid in 20 days, which has enormous impact for K cash flow, AI is having an enormous impact already have them. And they bring this down to 10 days pretty soon, because they can speed up the whole processing. So that’s a good example of where we’re going to benefit from AI in our companies that we have, we’re gonna have a lot more than 10 that benefit from it. Well,
22:27
I mean, will we see a shift in the healthcare system from being tech enabled or AI enabled to human enabled, eventually, you know, the tech is providing the majority of the diagnoses and the humans are assisting with the final 10%?
22:42
I don’t think so. I think there are certain jobs that AI is going to do in our healthcare system, it’s going to do workforce automation, and it’s going to help on data accuracy, personalization, staffing, efficiencies, all of that is already happening. But I was at a as I mentioned, an offside a couple of days ago with some leaders in healthcare. And this, you know, someone who ran a state healthcare organisation said, you know, you know, privacy fraud, age bias in AI, there’s a huge world economic forum report on age bias and AI, we are not going to get to the point where AI is making decisions on patient care, I believe, for a very long time. But in the meantime, it’s having tremendous, it’s a tremendous accelerant for a startup, to be able to bring that kind of, of product improvement experience improvement to end users and enterprise customers. To me, it’s like Excel and PowerPoint, it’s going to be just part of your business tech stack and see where it applies. Ellenwood
23:43
What do you think will happen to Google’s ad business in an LLM first search world,
23:50
I think they’re going to be affected just like anybody else in the marketing. You’re gonna You don’t have to spend too much time when chat GPT or any of the other services that are already out there and proliferating. And by the way, already starting to compete with one another, prices are going to come down. People are going to start recognising the costs associated with these with the magic one. And I think Google is going to have to, you know, obviously, employ AI they are already and you see them invest in companies that are using AI as a platform. So it’s going to have it’s going to have an impact on Facebook, Google, you name it could have impacted everybody.
24:32
Sure. So transition to FinTech a little bit. Consumer Debt rates are at all time highs while saving rates have plummeted. How close to a crisis are we in will the ageing population be able to service the debt that that has accumulated? It’s
24:48
a beautiful sunny Monday here in New York and I’d love to be an optimist. But I’ve recently been in conversations with leadership as I mentioned in some of these organisations, Let’s say this is a crisis. It’s a mathematical crisis, that it’s definitely could have been avoided or on different trajectory if there had been changes 20 years ago. But now we’re going to need to really make some painful choices on Social Security, we definitely looked at a few startups that are trying to help with a mathematical equation trying to help consumers defer Social Security, which there’s a bonus for doing if you, you know, push your social security app to start at age 72. We’ve invested in a couple of retirement savings businesses that are trying to encourage and make it easier for small businesses to offer 401k is given the global trillion dollar retirement savings gap we have. But as much as I’d love to be an optimist, Nick, this is something that only our policy leaders are going to have to reallocate capital to be able to fix.
25:54
Nick, let me go back to something. I don’t want any of your listeners to think Abby is boasting when she says, I was with these people at this conference or with those people at that conference, we will have usually pops in and tells you this, but I’ll say to myself, one thing we did very differently when we started practice is we both in addition to making wanting to make a lot of money out of this, we decided we really wanted to be thought leaders. So when Abby says she was here, and she was there, we hired, which is unusual. In my career, we hired a marketing PR firm from day one, which took a disproportionate share of our management fee because we had to pay for it to get us out there as thought leaders. So if you want to know one thing we’ve done differently, we made it so that we’re on every new show we can we get it every bag is here we can we want to be at every conference. And Abby, believe me is that named Abby, she’s exhausted. She just got back to the Annenberg conference. I think she’s probably going out to the Milken conference, we had, we were co sponsors of the AARP conference in Boston. And by the way, none of these places are the same in the same place. I was in Washington and another conference. I’m going out to Arizona next month. But it’s the resulted things like the cover of Businessweek saying longevity that cover over the economist saying longevity, we read up in the FT we were at the time, we wanted to make primetime known for what we stand for, and to elevate the subject that we’re involved in. So we really have worked hard and happy more than me as has got to be exhausted from getting back on one flip. And she does and but that’s why it’s made our fund so different is that we really have exposure to a lot of people in this business. And that’s very important to us. I
27:47
love it. Now, all you need is Deion Sanders as you’re supposed to. So on the positive side, the US education you know, in the US education levels are increasing older adults are working longer, poverty rates have dropped sharply, and more adults can meet their daily care needs. On the negative side life expectancy is stalled obesity prevalence is increasing at alarming rates. There are wide economic disparities between different populations, expanding caregiving gaps, as you mentioned before Abby, and the overall tax base will decline as older people you know, age. So what opportunities and threat or threats have you spent the most time analysing in which do you think, present the best opportunity for tech versus government to make a meaningful impact?
28:33
That’s easy. We got to slow down the increases in the cost of care. And, you know, with Medicare, as I mentioned, it’s about a trillion dollar expense growing at 8.4% a year, small changes, to slow down that growth on a big number have a very big impact. And so one of the areas for example, we’re very interested in is hospital visits to hospital visits cost 20 to $30,000 a year for older adults, or each occurrence does. And with a Medicare Advantage budget of around $90,000 a year on average per member, that’s a big piece to go for an IDI visit and think about all the ways we could stop those emergency room visits, fall prevention and detection, medication compliance and reconciliation, using AI to have risk stratification to have other ways of contacting someone when we think that they’re likely to have an adverse health event. Educating family caregivers not why not to call EDI and having other ways to do it. So businesses that provide immediate tangible cost savings versus healthcare businesses. As you know, as an investor that promise over three to five years there’ll be a reduction in the medical expense. There’s no patience to wait those three to five years especially when the average health plan member turns every three years or switches every three years. So that is one area that we are seeing a lot of tracks And in our portfolio and in the space is being able to reduce hospitalizations and really drive down the cost of care. So I think that’s a very interesting space. There’s a second interesting space of opportunities, which is, we actually have quite low utilisation of our health care benefits. In other words, we are very much a sick care business not, you know, country, not a welfare, and that with all of the social determinants of health supplemental benefits that health plans provide, you know, they’re only utilised by two to 5% of the members. And so what can we do to make sure that those benefits like home modification, you know, to prevent falls and food is medicine to make sure people are properly nourished, and transportation to get to doctor’s appointments and, and fitness and strength? And all of these things that are important parts of preventative care? How can we increase utilisation, and so we’ve seen a real growth in our own portfolio businesses like duos in our portfolio, and get set up that drives a health plan participation and engagement. Because at the end of the day, most of health care, you know, will require behaviour change by individuals, all the potions and medicines and this and that are very expensive, a much less expensive route over the long term is making better choices. So we’re seeing a lot of use of technology to drive that kind of engagement. So I would say those the two things prevent hospitalizations, drive engagement. And those are two big areas of opportunity. The
31:26
health plans that I have learned, Abby probably do it before I did, the health plans will spend anything, virtually anything to provide a supplemental service, if it will save them one day the hospital. Because I mean, I used as an example, we have one company that does balance, balance training. So it sounds so silly, you know, when they go to the gym, but if they can create better balance for people, and they don’t fall, the hospitals have besar to help them, then 500 I think it’s 500 $600 a year to give them at home telecon of telemedicine training, which you would call, you know, gymnastics perhaps. But if they could spend five or $600 and prevent one foil, because what happens is a fool than an ambulance, then get to the hospital, then you get a hip replacement, then you get the ammonia when you’re in the hospital, then you get sepsis, and then you die. And honestly, it’s a very high mortality rate. So it’s worth it in high cost of the payers, it’s worth it. So worth it to them to spend a little bit of training and assistance. You mentioned getting into the getting your doctors make sure you comply, all those things are worth the health plans spending the money so they don’t have the worst result.
32:46
Are you finding that the self insured employers are motivated as well? Or will it start with the payers?
32:52
I think they’re motivated by slightly different things on this topic of engagement, both are equally motivated, because engagement is not just around preventative health, it’s also around churn. And so they’re trying to figure out how to increase the retention, because it’s really hard to control costs have a population that is switching so frequently. So that is one similarity between the two audiences. But the commercial audience and they’re also everyone’s, you know, worried and concerned about cat, you know, the polychronic most expensive patients, and you don’t have to be older to be one of those patients. And so I think this that group is where the value based care is really coming in, in a much bigger way, is to say, you know, how can we very proactively manage this very expensive population? And that’s the starting point of the value based care models.
33:40
Do you think like in this world, with increasing workforce mobility, and people switching jobs more often, and subsequently switching their health plans more often? Do you think the payers have become less motivated to focus on long term health outcomes and more so on short,
33:57
absolutely, and I think that’s been documented in a variety of reports. But I also think that there’s an understanding, and this is where ai ai actually does get kind of interesting. There’s an understanding that pharma, there’s going to be a lot more pharmaceuticals, because the pace of life science developments increasing.
34:17
We love pharmaceuticals good and pharmaceuticals, keep our audience alive longer and use our products longer.
34:23
But what I was actually saying is the self insured employers and the payers are aligned and that they don’t love the pharmaceuticals in the sense of, they’re just getting really expensive. And the same thing on the surgical interventions. And all these innovation and in surgery and life sustaining surgeries is quite expensive. So I think we’re in for a bit of a I wouldn’t say it’s going to be a reckoning, but I think there’s going to come a point at which all the innovation in the life sciences is going to be indigestible on the insurance side. Because all it does is just increase. You know, yes, it’s wonderful for consumers but increases the cost of care dramatically.
34:58
So we’ve looked So quite a bit at rpm solutions and various biometrics, you know, to monitor patients at home.
35:07
We’ve looked at 35 companies in the area 35
35:10
app, I’ve got the perfect one for you. Good, by the way, well,
35:16
we kind of made one investment in the area, which is doing very well, but honestly, truly, it really has been most successful in the real estate area, and monitoring more than it has been in senior living, although we have pushed them into senior living and they are active in that area. But that is not their primary.
35:38
What does that mean the real estate area.
35:40
So what Allen’s referring to is and I’d be curious, your version of RPM, there’s kind of the remote patient monitoring, there’s kind of the monitoring of one’s own vitals and kind of the human mind that that piece of it. And then there’s another piece, which is environmental monitoring, monitoring. So particularly around fall prevention detection, there has been this sense of how do we monitor the environment for that specific use case. And we invested in a business called Butler, its Butler without an E. That was a commercial application for commercial real estate, using a heat sensing technology, all AI driven came out of MIT. And they had the idea of how could we apply this heat sensing technology to senior living or the home to monitor for false. And so that is what we refer to as it actually started as a commercial real estate solution being applied to an ageing topic. And one of the things we would love is we would love lots of businesses to take their technology or their approach, and ask themselves the question, what role could this have in an ageing population? Because that’s absolutely in scope. And I think that’s how we’re going to, you know, build a much bigger longevity economy is applying these, you know, most other technologies to this topic. But Nick, what was your question? What were you thinking about in regards to rpm? Well, I’m
36:59
trying to find the question, but I’m thinking you talked about the sick care system versus the health care system. I also feel like we have this episodic and reactive system instead of, you know, a proactive, perpetual system. And so I’m just curious if you know, the future, you do see more perpetual monitoring, instead of going in for an exam once a year, or going in once you’ve already fallen, you know, there’s a lot of more continuous monitoring of issue. There is the risk feels like an Area Tech can help with
37:29
if there is proactive, and we’re involved in several areas, not necessarily just in the room, but taking the room by monitoring people’s gait, and monitoring their times in the bathroom, all those things are predictive. And if you’re careful, you can spot trends and advance alternate, we’ve invested in two companies, one called consumer here on the West Coast, and the other called Isaac health. on the East Coast, Isaac, we’re focused on Alzheimer’s Kintsugi, more, I guess, concerned with depression, I’d say Abby can correct me, but it’s using telemedicine to discern changes in speech patterns, faint changes in human behaviour, that may be indicative of a change in their health condition and, and spotted earlier, and be able to take pre emptive steps.
38:23
And what Allen’s referring to is an area we’re very excited to around diagnostics. And so if you think about COVID, everyone became a self tester. We all I mean, we, you know, think about we all learned how to do diagnostics at home. And we’re seeing a lot of innovation in that space. And one of our portfolio companies that’s actually a longevity business, longevity clinic, the quarterly blood draw biomarkers, that’s a big space. And so where do we see this going? cyanogenic does a quarterly for their clients, we think that being able to track your data on a more frequent basis. And this is not just the aura ring, or a Fitbit or an Apple Watch. That’s great data, but really at the biologic level, is where we’re going to be able to look at the trend patterns, see aberrations, and be able to really have a predictive algorithm to warn people to escalate things and to deal with prevention. But it’s going to be come from diagnostics. And that’s why Kintsugi is so great, because it’s an ambient voice based biomarker for depression. And Isaac health has their model of how they’re diagnosing dementia. So I think we’re going to see a lot of innovation on the diagnostic side, that is going to coalesce with this change in human behaviour. That COVID was a huge accelerant of,
39:37
you know, as I’m listening to my show ourselves talking, we’ve probably hit 15 companies that we’ve invested in. So if people ask
39:47
us, tag them in the social posts, you know exactly
39:51
where we left the name of our of our right company, which is SafeRide, which, in that case, subsidised by the hospital. So as my health plan which is, you know, sounds so easy. Someone’s got to go to the doctor got to go to the hospital, you know, are they going to get there, you know, were they going to fall on the way to getting there? Are they going to live for the appointment, this is a company that specialises in, you know, picking up the patient from the doorstep, and checking conditions at the same time, taking them to the car, take him to the appointment, dropping a walk, making sure they get in, because everybody’s capable, and then being there on time, they have a 99% reliability. It’s not like your Uber, which you, which says you’ll be there in three minutes, it gets their intent, or never, this has to have a very high reliability factor. Another so all of these areas are serving if you’re, if you’re hurting, we said they’re all serving older people. Yeah,
40:46
100%. And some of these solutions almost seem like they make too much sense not to work. But one of the challenges we’ve run into is when you’re working with the payers that are super mo motivated to reduce high acuity issues, you also have to engage at the population and make sure they’re compliant. So it’s almost a two level sale, right? You get the payers, but then you also have to get the population, you know, how much is behavioural change, and, you know, resistance to new workflows and new behaviours. How much of that is a consideration and the challenge with dealing, when you’re dealing with the population that you’re focused on, it’s
41:29
really about the channel. In some ways, less the population, we’ve found the end user to be very open and willing to engage, as long as you can reach them, frankly, reach them, but usually telephonically sometimes over over text, and sometimes in person knocking on doors. And the issue with the channel is how willing are they to experiment and allow startups to use those means to reach the end audience? You know, when we started the fund in 2020, you know, you heard from the payers, we’re never giving our lists to vendors, we manage our customer relationship, our patient relationship, and you’re nodding, because you know, that they actually can’t reach their own audience very well. And so they are now allowing startups and giving that those patient you know, eligibility files and you know, ability to reach out and do the marketing on their behalf. So it definitely depends on the channel, those that are more or less willing to do that. But we are definitely seeing a shift. One actual myth, though, that I think this audience might be interested in is, there is this myth that will if I can reach the adult child, who is the family caregiver for their older parent, that is my marketing channel. And what I’ll always say to a founder who says, Listen, our target is the adult child, I will ask them if they have a living parent. And I will ask them, Are you able to convince your parents to do anything? And the answer is, of course, no. So why do founders think that they can build a business for the adult child to ultimately influence behaviour, the older adult, in our experience, unless that older adult has already admitted some diminishment of independence because they have dementia or Alzheimer’s or some reason why they cannot maintain their independence? That is not really the target market, the target market is the older adult, how
43:16
do you reach the population? You know, if you’re going straight to the six year olds, or the seven year olds is? Do you have to go through different channels in Abby?
43:26
Yeah, I mean, his the channels that are working really well, right now are affiliate channels. So a lot of our health care companies sell through financial services, players like life insurance, or retail banks, Wealth Advisors, retirement advisors, because they already have a trusted relationship with the individual. And the same thing digitally, you know, who has a trusted relationship, if someone’s a part of an affinity group, or an email or a blog, or, you know, the big issue with reaching this audience is trust. And that is because the trust has been so violated by all the fraud attempts, and the email marketing and the, you know, all of the sense of preying upon, you know, older people digitally, that’s real. And thus, the upset the, the silver lining of that is that marketers who can find trusted brands and relationships to be their proxy, are definitely doing it. So we find affiliate and referral, obviously referrals but affiliates working really well, for this audience.
44:23
You know, I got to share this. When I told my mom I was going into business, she’s now 71, she was so deflated, you know, in her world, it’s God, and then her doctor. So like the PCP, you know, is the ultimate hero in my mother’s life. I’m curious with the amount of noise and distractions and pharmaceutical reps and such that are, you know, targeting physicians. Is that also a part of kind of the channel focus and the way to get through to customers? It’s
44:53
interesting because the healthcare system has very low MPs and very low trust. So I’m so happy that your mother has such a wonderful relationship with her PCP.
45:07
Anything your doctor says she’ll do. I
45:10
would say that is not as prevalent as one would like. But the there are some areas of healthcare that I think are really working. First of all, there’s healthcare influencers, what we’re seeing, I don’t know, if you’ve seen the rise of these authors, you know, whether it’s David Sinclair, Peter, or TIA, Andrew Haberman, you know, a lot of people are starting to get information in sources other than their PCPs. In fact, people joke about Dr. Google, but the majority of Americans are using content online to inform their decisions. And so a very well thought out, I’d say, expert content marketing strategy, is something that we’re seeing a big roll on, roll for, we’re seeing less ongoing through the MD channel, just to be, you know, to be blunt. If
46:00
we can feature anyone here on the show, who do you think we should interview? And what topic would you like to hear them speak about?
46:05
Maybe I’m just in a policy frame of mind. But I still think that getting folks to take a look at the macro trends around venture. So I know that oftentimes the podcasts we do are micro on being a fund manager or a founder. But this question of where is this industry going? I think is one that is I wouldn’t say we’re at a critical point. But I think starting to work on the more governmental or macro lens on the macro economics of venture, you know, academics that study this, you know, the venture capital industry, those are the types of people to get their perspective on, where’s this going? I think that would be super interesting.
46:49
I know, honestly, I think I have to give it more thought, I’m gonna refer to my book, but I’m sorry, I don’t really I’m not doing it for that reason. One of the things I say, in my book, which I believe in very strongly, the reason I’ve been able to live this long and this healthy in this shape, is that I’ve had a very multi dimensional life. And so when you ask that question, you know, I’m friendly with philosophers. I’m friendly with politicians I’m friendly with historians with and by the way, venture capitalists, but that’s really not number one on my list. So, you know, I’m involved in theatre, I’m involved in music, I think that. So when you asked me this question, I’d have to really deep into the areas I met. I mean, I could say, you know, have Joe Biden Biden on the phone on the desk. But probably now the most interesting person I think he could probably have would be Anthony Blinken. I know all these people, I mean, I you know, I’ve lived such an active life and moved around a lot. And I know almost everybody that I would say, would not be someone in the venture business, I would pick somebody who would bring some insights into the world we’re living and have a thoughtful viewpoint on, you know, how we’re all going to live longer and make like an have an interesting life. Awesome,
48:04
remarkable. And then aside from your book, you know, is there another article book or video that you’d recommend the listeners,
48:13
it’s a book called this chair rocks, a manifesto on ageism. And I think if you really start to understand our inherent age bias, I think that there are some really great lessons for how you run your business, for opportunities for investment. And then for how you create around you an environment that is age inclusive, for your own benefit, and for the benefit of your loved ones, you know, that you know, full stop. It was a book I read before starting the fund, and it’s not fringe or niche, it is a really important part of day to day living.
48:53
Perfect. Do you have any habits, tactics or techniques that are a secret weapon?
48:58
I for Alan, I’ll tell Allen’s Allen walks everywhere. And it is a secret weapon, not just from a wellness perspective. But also he bumps into people we always joke, you know, who when we walk around New York together, that, you know, neither of us can walk, you know, two blokes without bumping into somebody. But I think it’s also just an outlook on life. And granted, we’re in New York, if you’re in a suburban environment, it’s a little harder to have that same experience if you’re a listener, but I think it’s really indicative of just an outlook but also a way to get things done. So that would that would be a habit that Alan is your habit and is a hallmark of you.
49:32
I have a very positive outlook on life. I only know the word. Yes. And I think that’s a good way to that’s a secret to longevity, and to living a happy life. And I just got my wife 15 years died three years ago and I got remarried a few months ago. someone I’ve known a long gratulations lost
49:54
her husband. And so he definitely said yes.
49:58
So So I mean, I think income loss, you know, long term you gotta wake up every day. And not don’t say I’m depressed but say, I’m excited about you know what I’ve got on my platform for today. I think that will be a helpful lesson for longevity. I work. I work every place. You really possible. I just did eight miles with my wife yesterday, country. And this morning I didn’t because I’ve been working all day. But tomorrow morning, I’ll be working it’s seven o’clock with a trainer getting ready to see if I can do this marathon. Well,
50:33
best of luck to you with the marathon. I don’t think there’s a point that’s better to finish on than that. She is Abby Miller Levy and he is the legend Alan Patricof of primetime partners. Thank you both for spending the time this was a true thrill. Thank you.
50:53
All right, that’ll wrap up today’s interview. If you enjoyed the episode or a previous one, let the guests know about it. Share your thoughts on social or shoot him an email. Let them know what particularly resonated with you. I can’t tell you how much I appreciate that some of the smartest folks in venture are willing to take the time and share their insights with us. If you feel the same, a compliment goes a long way. Okay, that’s a wrap for today. Until next time, remember to over prepare, choose carefully and invest confidently thanks so much for listening