Ecumen, a nonprofit operator of senior homes in Minnesota and much of the Midwest, said Friday that it is joining a $26.6 million private equity fund investing in businesses that are creating new products and services for seniors.
The fund, a joint venture of a Chicago investment bank and an Ohio-based consortium of senior home operators, is part of a growing wave of investment activity in the senior space, lured by the combination of aging baby boomers, health care reform and swift changes in technology.
"We're entering a longevity economy," said Eric Schubert, a vice president for Shoreview-based Ecumen. "And we're asking, 'How do we create new points of value for people who are aging?' "
The fund is the result of two years of development effort and footwork by Link-age Ventures Inc., a Mason, Ohio, group that provides resources and services to senior home operators, including Ecumen. It joined with Ziegler, a Chicago investment bank with a record in the health care industry, to set up the fund. Ecumen is one of about 70 nonprofit organizations that contributed to it.
The fund, called the Ziegler Link-age Longevity Fund, will look for opportunities to take stakes in firms in health management, telemedicine, prevention and wellness and so-called "big data" analysis geared toward seniors. It will not invest in real estate, said Scott Collins, chief executive of Link-age.
"There are so many different technologies coming out now that we feel, if not purpose-built, they could be shifted to meet the needs of this demographic," Collins said. "Getting old is not just about aging in place anymore. It's about thriving."
He said firms seeking capital can approach Link-age, where the fund's chief investment officer is based. Investments will be vetted jointly by Ziegler and Link-age.
Similar funds have been set up by AARP and a San Francisco firm called Generator Ventures, which has pushed to get Silicon Valley investors and start-up firms focused on the opportunities in the senior market.
