Min­ing for Sil­ver

As Sin­ga­pore’s pop­u­la­tion ages, its grow­ing army of se­nior cit­i­zens will be­come in­creas­ingly at­trac­tive to busi­nesses

Portfolio - - IN THIS ISSUE - byJim­myYap

It has be­come an in­creas­ingly com­mon sight in Sin­ga­pore. On pave­ments, mo­bil­ity scoot­ers jos­tle for space with able-bod­ied of­fice work­ers. In air-con­di­tioned food courts, gag­gles of sil­ver­haired in­di­vid­u­als con­gre­gate for cof­fee and con­ver­sa­tion.

It is not sur­pris­ing that se­nior cit­i­zens are now so vis­i­ble in Sin­ga­pore. In De­cem­ber 2017, it was re­vealed that there are now more than half-a-mil­lion cit­i­zens and res­i­dents aged 65 and above.

By 2030, one in four Sin­ga­pore­ans will be se­nior cit­i­zens. Given that peo­ple are hav­ing smaller fam­i­lies and that life ex­pectan­cies are in­creas­ing, the oc­ca­sional mo­bil­ity scooter seen to­day will even­tu­ally turn into a con­voy, lum­ber­ing down paths and pave­ments all around the is­land.

For en­trepreneur­s and com­pa­nies, Sin­ga­pore’s chang­ing pop­u­la­tion pro­file rep­re­sents new op­por­tu­ni­ties. Sin­ga­pore’s sil­ver-haired grand­moth­ers and grand­fa­thers may be in their sun­set years, but their in­creas­ing num­bers rep­re­sent a sun­rise in­dus­try.

Ac­cord­ing to an es­ti­mate by mar­ket con­sul­tancy Age­ing Asia, the elder­care in­dus­try will be worth US$3.3 tril­lion in the Asia Pa­cific by 2020, with the num­ber for Sin­ga­pore hit­ting US$46 bil­lion.

Ms. Jan­ice Chia, the founder of Age­ing Asia, says that com­pa­nies ex­pect the mar­ket to ex­plode in 2025. How­ever, com­pa­nies in Sin­ga­pore still haven’t quite cot­toned on to the op­por­tu­ni­ties in the sil­ver mar­ket, ac­cord­ing to her.

“They know it’s go­ing to be big but they don’t know how to get into the age­ing mar­ket.” As bod­ies age, there are phys­i­o­log­i­cal changes that need to be ad­dressed, notes Mr. Kim Walker, the chief ex­ec­u­tive of strate­gic mar­ket­ing con­sul­tancy Sil­ver Group. “There­fore, any busi­ness per­son who is se­ri­ous about meet­ing the needs of the pop­u­la­tion as it ages, must un­der­stand these phys­i­o­log­i­cal changes.”

The mar­ket is much big­ger than read­ing glasses, walk­ing sticks, grab bars and shower chairs though. In ad­di­tion, Mr Walker be­lieves that apart from new prod­ucts, there are also op­por­tu­ni­ties for com­pa­nies to take ex­ist­ing prod­ucts and ser­vices and re­tool them for older con­sumers.

“Repur­pos­ing is a huge op­por­tu­nity,” he says. “Think Grab for se­nior cit­i­zens. Think Match.com, which is now ex­tremely pop­u­lar among the 50-plus set.”

Suc­cess­fully tar­get­ing older con­sumers will re­quire that the en­tire cus­tomer jour­ney be re-eval­u­ated though. “That in­cludes com­mu­ni­ca­tions, the on­line ex­pe­ri­ence, in-store (re­tail), prod­uct design and the ser­vices that sur­round it all.”

HOME CARE MAR­KET TAKES OFF

In Sin­ga­pore, be­cause peo­ple pre­fer to grow old at home, one im­me­di­ate op­por­tu­nity is home care, says Ms. Chia.

Much of the ac­tiv­ity in the home care mar­ket is tak­ing place at the nexus be­tween de­mand and sup­ply. A num­ber of start-ups are look­ing to be the Grab of the home ther­apy mar­ket. These com­pa­nies be­lieve by lever­ag­ing on tech­nol­ogy, they can help peo­ple find care­givers more eas­ily.

This sec­tor ap­pears to be ripe for dis­rup­tion be­cause un­til re­cently, much of it ap­peared to be mired in the 1980s. “It’s an in­dus­try that hasn’t been fully im­pacted by tech­nol­ogy,” says Ms. Gil­lian Tee, the founder of Ho­mage.

Af­ter ex­pe­ri­enc­ing the dif­fi­culty of find­ing a care­giver for her for­mer nanny (now de­ceased), Ms. Tee started Ho­mage in 2016 as a match­mak­ing plat­form be­tween care­givers and those seek­ing them. The com­pany cur­rently has 800 full-time and part-time care­givers in its data­base and is look­ing to ex­pand into Malaysia.

A sim­i­lar com­pany, Care­giver Asia, was founded by Ms. Yeo Wan Ling in 2014. The com­pany de­scribes it­self as an on­line ag­gre­ga­tor of health and care­giv­ing ser­vices. It has be­tween 7,000 and 8,000 Sin­ga­pore-based care­givers in its data­base. Thanks to its suc­cess, the com­pany has ex­panded its of­fer­ings into Hong Kong, Malaysia, South Korea and the United States.

There is also a lot of ex­cite­ment around lever­ag­ing tech­nol­ogy to di­rectly im­prove the lot of the el­derly. Think of how the lat­est Ap­ple Watch is mak­ing waves be­cause of its abil­ity to de­tect falls and do EKG read­ings.

In Sin­ga­pore, com­pa­nies are rac­ing to put smart sen­sors in the home to en­sure that peo­ple can keep tabs on their loves ones who might be alone at home. Com­pa­nies like Aus­tralian-listed HomeS­tay Care have an In­ter­net-of-things plat­form that can be used to build a smart home. In this home, sen­sors can de­tect if some­one is pos­si­bly in dan­ger.

TAR­GET­ING THE HIGH-END MAR­KET

Busi­nesses aren’t just look­ing for cut­tingedge tech­nol­ogy to sell new prod­ucts and ser­vices though. Some com­pa­nies are tak­ing the old fash­ioned route of tar­get­ing the pre­mium end of the mar­ket, pro­vid­ing ser­vices to a seg­ment of the pop­u­la­tion where the mar­gins are higher.

There are now se­nior ac­tiv­ity cen­ters like Hovi Club in Turf City that al­lows clients to groom horses or en­gage in wa­ter ther­apy. Monthly fees at Hovi Club range from $1,800 to $2,400 for a five-day week.

Com­pa­nies are also of­fer­ing pre­mium ver­sions of long-term res­i­den­tial care. While nurs­ing homes in Sin­ga­pore are cur­rently viewed as grim dor­mi­to­ries with reg­i­mented pro­grams and less than pleas­ant liv­ing con­di­tions, a new gen­er­a­tion of nurs­ing homes are of­fer­ing some­thing vastly dif­fer­ent.

St. Ber­nadette’s Life­style Vil­lage in Bukit Timah is an as­sisted liv­ing fa­cil­ity that of­fers sin­gle rooms with en-suite fa­cil­i­ties. At St. Ber­nadette’s, care with meals comes to about $4,200 a month.

St. Ber­nadette is just an eight-bed fa­cil­ity though. At the other end of the spec­trum is Al­lium Health­care Hold­ings, a sub­sidiary of in­vest­ment hold­ing com­pany G.K. Goh Hold­ings. Al­lium is build­ing a 129-bed nurs­ing home on Venus Drive, which is sched­uled to open in mid-2019. The nurs­ing home will only have sin­gle and dou­ble rooms, all with en­suite fa­cil­i­ties.

The ex­is­tence of all these com­pa­nies is ev­i­dence that busi­nesses see a mar­ket op­por­tu­nity from elder­care. And it’s not just en­trepreneur­s ei­ther. Ven­ture cap­i­tal money is also in­ter­ested in this seg­ment.

Ho­mage has re­cently com­pleted its Se­ries A fund­ing, and in to­tal, it has raised be­tween $7 and $8 mil­lion so far, says Ms. Tee. “There is a lot of in­ter­est from VCs.”

Ms. Yeo of Care­giver Asia agrees. “I have had four or five dif­fer­ent VCs come to me to tell me they are in­ter­ested in in­vest­ing in us,” she says. The com­pany has done three rounds of fund­ing al­ready: a seed round, their Se­ries-A, and early Se­ries-B fund­ing.

While VC in­ter­est might sug­gest that elder­care could be highly prof­itable, this might only be true in sec­tors where tech­nol­ogy of­fers the po­ten­tial for dis­rup­tion, and thus large re­turns. In de­scrib­ing the in­dus­try in gen­eral, Ag­ing Asia’s Ms. Chia de­scribes it as re­quir­ing “pa­tient cap­i­tal”.

Mr. Bernie Poh, Al­lium’s chief ex­ec­u­tive, takes pains to note that in­vestors in this sec­tor would need to wait longer than nor­mal to see re­turns. “This is not the FMCG sec­tor,” he says.

A CHANG­ING REG­U­LA­TORY REGIME

An im­por­tant fac­tor de­ter­min­ing prof­itabil­ity is gov­ern­ment reg­u­la­tions. Cur­rently, many of the com­pa­nies in the space are reg­u­lated un­der the Pri­vate Hos­pi­tal and Med­i­cal Clin­ics Act.

The Act was en­acted in 1980 and last amended in 1999. Much has hap­pened in Sin­ga­pore in the last two decades, and the coun­try’s Min­istry of Health rec­og­nizes the need for new care mod­els across dif­fer­ent set­tings and providers. In ad­di­tion, new med­i­cal and health tech­nolo­gies have given rise to new and fast chang­ing health­care ser­vices.

As a re­sult, the gov­ern­ment plans to re­place the ex­ist­ing Act with a new Health­care Ser­vices Act in 2019.

Most of the com­pa­nies in­ter­viewed re­port that the gov­ern­ment has con­sulted them on the new Act and they wel­come the move to the new regime.

Cur­rently, un­der the ex­ist­ing reg­u­la­tions, com­pa­nies such as

St. Ber­nadette’s that run an as­sisted liv­ing fa­cil­ity end up be­ing gov­erned by the same yard­stick as acute hos­pi­tals, a sore point for Dr. Belinda Wee, the founder of the com­pany.

In ad­di­tion, cur­rent reg­u­la­tions re­quire dif­fer­ent premises for dif­fer­ent ser­vices, which means that if a nurs­ing home wanted to of­fer day­care ser­vices or re­hab ser­vices, they would need to have sep­a­rate premises.

Un­der the new pro­posed law, health­care providers will be li­censed based on the type of ser­vices they pro­vide rather than on phys­i­cal premises. The change is some­thing that Dr. Wee is look­ing for­ward to.

Care­giver Asia’s Ms. Yeo says her con­cern has been about the li­cens­ing of care­givers. “While peo­ple pro­vid­ing ther­a­peu­tic care have to be rig­or­ously trained, we also have gen­eral care­givers like

nurse aides and even com­pan­ions who (is paid to) read news­pa­pers aloud. Are you look­ing for a li­cens­ing body for ev­ery sin­gle one of these groups?,” she asks rhetor­i­cally.

She says that she has been talk­ing to the rel­e­vant min­istry about these is­sues.

Reg­u­la­tory frame­works aside, Ms. Yeo has found that the dif­fer­ent gov­ern­ment agen­cies in Sin­ga­pore are in­ter­ested in want­ing to ad­dress the is­sues around Sin­ga­pore’s age­ing pop­u­la­tion.

“I see a con­certed ef­fort among Sin­ga­pore agen­cies and bod­ies like the NTUC to work on age­ing.

“That’s the great thing about Sin­ga­pore. It’s like a kam­pung where ev­ery­one comes to­gether.”

Care­giverAsia web hot­line

Ms. Yeo Wan Ling, Founder of Care­giver Asia

Hovi Club in Turf City al­lows clients to groom horses

Care­giverAsia Home nurs­ing a fam­ily

St. Ber­nadette’s Fo­liage room

Al­lium Care Suites Per­spec­tive

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