Humans have lived for approximately 8,000 generations, but only in the past four has life expectancy taken dramatic leaps upward thanks mostly to societies addressing some of the most basic life issues, including infant mortality, heart disease, homicide and influenza. In 1907, the average human life expectancy was 46 years; in 1957, it rose to 66; in 2007, it reached 76.
But I predict we won’t stop there. Over the next generation or two, I see us living to 150 years, largely driven by breakthroughs in genomics and bioengineering. That might seem like a long-odds prediction, but it’s good to consider outlier possibilities.
Too often, startups, or any companies trying something new, are only viewed against existing constructs. If we consider the possibility of fundamentally different paradigms, such as much longer human lifespans, we can see the need for even more innovation beyond what today’s startups are working on. Longer lifespans will deeply impact almost all aspects of society. Financial markets, education and healthcare, to name a few, will need to undergo profound changes to adapt to such severe strain.
The financial models used today have a few core assumptions, including the average number of income-earning years (currently pegged at 45, roughly from one’s early 20s to one’s late 60s), a retirement age around 65 and an average life expectancy of 75. As the population starts living past 100, the drive for continued financial returns will be put under pressure. Compounding interest will dramatically increase available capital by extending the time that money is invested (i.e. how long we live).
In 1907, the average human life expectancy was 46 years; in 1957, it rose to 66; in 2007, it reached 76.
A specific example may help make this clear. At 25, you invest $15,000 at an annually compounding interest rate of 5.5 percent. At 65, when you retire, it’ll be worth around $127,000. That’s a pretty good return, but if you reach 125 before you withdraw it, it will be worth nearly $3.2 million, or 25x as much! Multiply that by millions of people and you can see how a new financial system and new services will need to evolve to handle exponentially more cash and over greater time periods.
This influx of capital into the system will drive people to look for alternatives to 401(k)s, investments and even savings accounts. This is already happening in response to the influx of cash into the economy over the past six years. Startups like HomeUnion, an Artiman portfolio company, help create customized real estate portfolios with properties in distant cities and manage them for rental income, similar to an annuity. Prosper, Lending Club and SoFi are crowdfunding companies, matching buyers with willing lenders to provide access to alternative methods of financial returns.
Another aspect of society that will be impacted by extended lifespans will be education. The baby boomers were the last generation to have one career and one employer. Future generations will likely have multiple careers across their lifespan, so the need to learn new skills will grow dramatically, especially as the time frame of economic productivity gets extended. Terms such as MOOCs (massively open online courses) and nanodegrees are already becoming prevalent, and many startups are addressing career transformation: Coursera, General Assembly, Udacity and Udemy.
The medical and healthcare industries will also undergo a dramatic shift. Technologies such as personalized gene-based therapies and regenerative medicine, sometimes referred to as bio-printing human tissue, will create a step function in human longevity. As people live longer and work for multiple employers, the nature of health insurance may change to corporate-subsidized but individually purchased and priced. Insurers are looking to new devices to help ascertain their subscribers’ health as well as encourage preventative medicine to reduce claims.
For example, if you provide your Fitbit information to your insurance company, they will reduce your premium so long as you keep your average heart rate below 100 beats per minute. This could have a profound impact on healthcare devices, monitoring and communications.
It’s not just healthcare, education and finance that will change dramatically as the average lifespan moves toward 150. Housing, transportation, entertainment, energy and even agriculture will also have to develop rapidly.
With stereotypical “Silicon Valley optimism,” I think that public and private markets will meet the needs of a larger and older population. But making the necessary changes won’t be easy, and we can expect more than a few bumps and failures on the way. So buckle up — those of us around for the next two generations are probably in for an interesting ride.