We are pleased to publish the first iteration of our investment strategy which seeks to identify the areas where Big Society Capital’s resources - our time and investment capital - can be most catalytic and help improve people’s lives as they age.
Why are we focusing on “Ageing” and outcomes in later life?
As we explored how social investment can support early action to prevent problems, we became evermore aware of the many challenges facing an increasing number of people as they age.
People in the UK are living longer than ever, with one in three girls born in 2011 expected to live to 100. While some people can enjoy the benefits of their longer lives, many people’s experience of later life can be a real struggle. Improvements in life expectancy have outstripped improvements in the quality of life and the prevention of debilitating age related diseases. However, the physical effects of ageing are just one piece of the jigsaw. Older people are also more likely to feel disconnected and lonely, to find it difficult to access local services, to live in unsuitable homes or to suffer from poor mental health.
Unsurprisingly many of these issues are also felt by the lowest socioeconomic groups: women, ethnic minority groups and the LGBTQ community.
In the next 25 years, 70% of the UK’s overall population growth is expected to be amongst the “over 60s” group, increasing in number from 14.9 million people in 2014 to 21.9 million people in 2039.
The status quo is unacceptable. More must be done to support and care for those already facing these issues, but it is also critical that we shift our focus from treatment to prevention so that a greater number of people can live well for longer. It’s imperative that we approach the concept of improving people’s outcomes in later life (or “ageing well”) holistically. By considering all of the potential influences on an individual’s wellbeing, rather than addressing symptoms in isolation, we hope to fundamentally improve people’s experience of ageing.
Change is an opportunity
This need for change creates an opportunity and demand for innovative approaches from individual as potential customers, to businesses needing to rapidly adapt to the changing needs of their employees, to local and central governments struggling with the increasing pressure on existing acute health and social care services.
Older customers have been poorly served to date with products and services often disempowering, clinical and stigmatising. This has led to limited demand for the products and services that do exist. The Centre for Ageing Better found that rather than adapt their homes to their changing needs, people were more likely to adapt their behaviours, such as limiting their food and drink intake to avoid using the bathroom.
We need to design new approaches with older people rather than for older people and create attractive products and services which empower people to live the lives they (and we) aspire to live. Often these may be “age-inclusive” or “age-less” in design, and are accessible and usable for all rather than specifically limiting their use to older people.
The early signs of a movement building
Whilst social entrepreneurs are increasingly aware of the unmet need of individuals and the market opportunity that clearly exists, significant gaps remain in the availability of investment and specialist support for these entrepreneurs, hindering the development of innovative new approaches. This is especially true for entrepreneurs at the very early stages of their development, where grant funds and seed-stage investors can be difficult to access and when organisations need the greatest amount of support to refine their offers and reach their first customers.
Investor interest in the space is growing, with investors (including many of our existing venture, outcomes and property funds) leading funding rounds to support the scale up of innovative charities and social enterprises such as Oomph!, Breezie, HomeTouch, CASA, and Unforgettable, proactively leading the development and providing investment into Reconnections Worcestershire and Ways to Wellness Social Impact Bonds and backing property-based models such as OneHousing’s Extra Care developments, Belong Living’s care villages and Greensleeves’ care homes. Collectively these represent just under 9% of our investment portfolio at the end December 2017, however this falls to just over 3% when removing our property-based investments and we believe more needs to be done to focus investment and support in this area if we are to materially change people’s experiences in later life.
Having surveyed the funding, investment and support available for ageing-related entrepreneurship we have identified 5 key opportunity areas that we believe can help accelerate the development and scale of impactful approaches that seek to improve people’s experience of later life. These include:
- Stimulating new ideas and innovative approaches to ageing-related challenges through the development of ageing-focused prizes, hack events and cohorts of venture builders;
- Testing and developing promising innovations further through the use of development grants, as well as tailored incubators and accelerators to help support teams in their earliest stages of growth;
- Scaling up potentially sustainable models that are showing significant potential for impact and sustainable financial returns. This is especially true for opportunities in the ageing space which are addressing unproven markets, use novel technologies or are adopting business models which may limit their ability to raise investment capital from non-specialist investors or where they could materially benefit from mission-aligned, ageing-specialist investment and support;
- Supporting innovative property-based models which are emerging here in the UK and abroad. These may include models that have the potential to support independent living for longer such as intergenerational living, inclusive communities, co-housing or adaptable home-for-life models, or those that can potentially provide a better quality of care for the most vulnerable such as specialist Dementia Villages; and
- Creating a more collaborative ecosystem of ageing-focused funders, investors, academics and government representatives to help share insights, experiences, expertise and best practice between these otherwise largely siloed groups. By finding partners to co-host and co-creating a cross-sector network around the shared goals of improving people’s experience of ageing, we hope to accelerate each group’s work and our collective effectiveness.
Over the coming year we will continue to look for partners and opportunities where we can use our investment capital to catalyse new, best in class ageing-focused investors who can provide not only the investment capital necessary but also the access to the specialist networks, resources and hands on support to accelerate the growth and development of innovative social enterprise models addressing these critical social challenges.
We will prioritise opportunities whose interventions and support is made available to those in greatest need and the most disadvantaged, either by providing universal access or by specifically targeting underserved groups.
We cannot do this alone and we would love to hear from partners interested in collaborating with us and co-designing our investment approach to this area – as an issue advocate, as a co-investor, as a fund manager or as a charity or social enterprise seeking investment.
Furthermore, where our investment capital is ill-suited as a tool to meet the gaps identified, such as to stimulate new ideas or to support very early stage development and testing, we will look to collaborate with peers and partners who may be better placed to support these initiatives in the existing funding and support ecosystem.
We would like to thank all of those who have supported us to date with their insightful conversations and openness. The launch of the first iteration of our strategy is just the beginning, and we are incredibly excited about the opportunity presented to make a profound change and to improve people’s experience of ageing so that everyone can enjoy a later life.