Building Inclusive Companies with Alan Patricof, of Primetime Partners #2
Alan Patricof, co-founder of Primetime Partners (and Greycroft Partners, Apax Partners), talks about the benefits of building companies for people over 50, by people over 50.
Links:
MIT: “Successful entrepreneurs are middle-aged, not young.”
The number of Americans ages 65 and older will more than double over the next 40 years
Brian Smiga: Speedy VC, and I'm here with my new friend, Alan Patricof. Hi Alan, how are you?
Alan Patricof: Hi, Brian.
Brian Smiga: Great to meet. I'm doing a series on the inclusive economy, and VCs and founders that are building products and services for neglected communities or for a wider audience. You just started Primetime Partners, a new venture fund; your third. Everyone knows who you are. I'm not going to do your intro, but tell us about Primetime.
Alan Patricof: Well, I got this idea in the last year or two, primarily from the fact my wife had a long bout with Alzheimer's, and so I made myself familiar with what was happening for people who were getting older, and not just people who have chronic diseases, but people in general who were going into what I had called the “ageless generation”. Everybody's so focused on Millennials. But I came to realize from reading enough, that the people over let's say 55-60 are going to be the fastest growing part of the population. They're going to be a bigger and bigger share of the population in the next 20 or 30 years. They're going to live longer. They have money, and more money to spend. And so I said, why is everybody focused on Millennials? There's a great big white space to focus on serving this older generation with products, services, experience, technology, media, anything one could think of.
I joined up with Abby Levy, a woman whom I had known since she was president of Arianna Huffington's company, Thrive Global, and I was on the board, and we'd gotten to know each other and I found out through one of my sons who had been a classmate of hers, that she was focused on the same subject. I didn't know it because all we saw each other was at board meetings, and we got together very quickly. We added in a strategic partner, which is one of the biggest operators of senior living facilities in the country, a company called Welltower, and we just launched a fund. We decided to keep it small to actually test the concept, and we've been in business now for a year as of July 8th 2021, and we've made 14 investments, and it's going great.
Brian Smiga: Wow. So you've been investing at greater than one investment a month, and you're going to be celebrating your first anniversary. How have you sourced these deals, and what's your criteria, Alan?
Alan Patricof: Well, I do things like this podcast and hope people will hear it and send us an idea. And if they're not doing that, we go out and do outreach to universities. There's a program at Stanford going on. There are associations, there are foundations; everybody seems to be thinking about it, this very big segment of the economy, and yet there are very few venture funds that are focused on it. So we set out to be the thought leader. We want to be in a position where if anyone is thinking about the subject of the ageless generation, that they call Abby Levy, my Primetime partner, or myself.
Brian Smiga: Okay. So for companies serving folks say over 50, and also, I think you're looking at founders who are over 50, who have built something great, and maybe having trouble getting funding as well.
Alan Patricof: No, that's exactly correct. That's our secondary focus, is we want to encourage entrepreneurs who have built a business, or built two, at the ages of their late fifties or sixties, who have done it once or twice and who built successful businesses to say, instead of going to play golf in Florida, or just sitting on the beach, why don't you start it again? And we're willing to back you, whether you are in the paint business, or you're in the glove manufacturing, as long as it's the same business, and as long as you attract people who are working for you or with you in your previous role, because that to me is a bigger endorsement than people just investing. Because at the end of the day, we're money, we do a lot of good things to help our companies, but someone who picks up and gives up their career and joins someone; that speaks volumes as far as I'm concerned.
Brian Smiga: Yeah. This is a great invitation. So entrepreneurs out there over 55 let's say, who've built something successful, having trouble getting funding, see Abby and Alan at Primetime. This is a really inclusive VC. You're focusing on a neglected market, but it's also a huge problem. I think about precision health investing and the cost burden that it might relieve. So too an aging and unhealthy population is a huge cost burden to society, which could be turned into a benefit, so give us an example.
Alan Patricof: People are not focused on the fact that everyone who's listening to this podcast, or anyone who you know in that sandwich generation, and which there are supposedly 50 million people who have some relative who is facing the problem of elderly living, and the challenges it presents, could ultimately become a caregiver of one sort or another. Not a paid caregiver, there is a profession of paid caregivers, but I'm talking about just anyone you're sitting around the table with who's worried about their mother, their father, their brother, their husband, their cousin, their best friend... So all of us are going to end up indirectly one way or another becoming caregivers, and these people all need help in doing that role.
Brian Smiga: And then for those of us that don't need that care right now, but are in the ageless generation like yourself, and even me, there's the prospect of working and doing really interesting work, and leveraging a lifetime of experience and relationships. So at 85, you started Primetime. What keeps you going? What is it that keeps you healthy, and going to start this third venture fund after a career in venture?
Alan Patricof: Well, first of all, I'm in excellent health and I keep myself that way by exercising, and doing all the things that one should do to stay healthy. I bike, I hike, I do all the things here that keep me alert. I also read a lot. I participate in everything I can, and obviously I meet a lot of young entrepreneurs and that charges you up. You can't help but be energized by meeting all the people with creative ideas.
Brian Smiga: A hundred percent. I so agree. And look, I think that in the professional services and venture in particular, it gets stigmatized as a young person's game, but it's actually anyone's game. And I think returns show that the older VCs actually outperform. What do you think about that?
Alan Patricof: Definitely. There was a study done by MIT about a year ago, two years ago, it was one of the things we cited when we started, which says that an entrepreneur over the age of 40 is twice as likely to be successful as one who's in their twenties.
Brian Smiga: Okay. So there we have it. Alan, thank you so much. This has been Brian Smiga, the SpeedyVC, and Alan Patricof. It's a privilege to talk to you. This is the Speedy VC podcast. We're talking about the benefits of building companies for people over 50, and by people over 50, with Alan Patricof, age 86. Thanks, Alan.
Alan Patricof: Thanks for inviting me.
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