Aegis President: Senior Living Today Reminds Me Of Starbucks 20 Years Ago

When Kris Engskov took a job with Starbucks in 2002, the iconic coffee purveyor was only a fraction of the size that it is today.

“It was at the time a pretty small, entrepreneurial company that was values-oriented and thought it could change the industry and consumer tastes,” Engskov told Senior Housing News. “I see similarities at Aegis.”

That’s Aegis Living, the Bellevue, Washington-based senior living provider that Engskov joined as president about eight months ago.

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To be clear, Engskov does not think that slinging coffee is all that similar to providing housing and care for older adults, and he is not aiming to build Aegis Living communities on every street corner.

But, similar to Starbucks of 20 years ago, he believes that Aegis today is a values-oriented company that is ready to drive innovation and gain scale in a sector on the cusp of massive growth.

“Very few people understand the magnitude of the change we’re getting ready to go through,” he said, referring to how society will be transformed as the baby boomer generation ages. Meeting the needs of this generation might be the greatest challenge of our time, Engskov said. But rather than “challenge,” there is another word that he is focused on: opportunity.

From a business perspective, the opportunity is tremendous, and Aegis is already making moves to seize it. The company operates a 32-property portfolio, and that will double in size within a decade, Engskov said. Currently, Aegis is underway on a $500 million pipeline of seven developments on the West Coast.

Beyond the planned growth, Engskov is determined to expand on Aegis’ reputation as a company that pushes senior housing and care in new directions.

“My expectations were high, but they’ve only gotten higher as I’ve spent more time here, looking at the opportunity we have to innovate and grow and change the trajectory for senior care,” he said.

An education in senior living

Even before joining Starbucks, Engskov had achieved notable professional success, as assistant White House press secretary and then personal aide to President Bill Clinton. He went on to work as an analyst at Madrona Venture Group. Then, he wore a number of hats during his time at Starbucks, including leading operations for about 8,300 stores as president of U.S. retail.

With this background, Engskov is a notable new addition to the leadership ranks of senior living — and it not a sector that he intentionally sought out when he considering his next career move after Starbucks. At that time, David Tate — a member of Aegis’ board and the inventor of the boardgame Cranium — urged Engskov to meet with Aegis founder and CEO Dwayne Clark.

“He educated me over a number of conversations,” Engskov said. “Clearly, this is Dwayne’s company in many ways … We share a desire to do disruptive things through a value-based culture.”

Engskov also was drawn by the chance to help shape a quickly maturing industry. While acknowledging that Clark and other pioneers created contemporary senior living and continue to shape it, he believes that the sector will truly come into its own in the coming years as consumer demand explodes.

“I feel like I’m getting in on chapter one,” he said.

If his early talks with Clark started Engskov’s schooling in senior living, his education became much more intense after he joined Aegis’ leadership.

“Dwayne was very clear that for the first five to six months, I was to go out and learn the business,” Engskov said.

That meant serving as a care manager in every one of Aegis’ operational communities, working shifts at all times of day. His first experience was showing up at six o’clock in the morning and being taken in hand by a caregiver, Helen, who taught him how to wake residents and assist them with showers and dressing and getting to breakfast.

“She couldn’t care less who I was,” Engskov said. “I knew that I was in the right business. I loved that.”

Aegis of the future

Engskov’s predecessor as Aegis president, Judy Meleliat, officially retired about three months ago. Since then, he has transitioned out of working shifts at communities and into the corporate position, with a focus on making more connections in the industry and leading a variety of operational and growth initiatives at Aegis.

With the goal of at least doubling the size of the portfolio in the next decade, the expansion plans are ambitious. In addition to doing development in its home state of Washington, the bulk of the growth will come in urban California markets such as Los Angeles and San Francisco.

About half of Aegis’ existing communities are in California, and the company believes that urban areas in the state will be hotbeds of demand for the type of premium product that Aegis delivers.

The company is known for its unique designs and innovative programming and amenities — for instance, its most recently opened community was inspired by a ski lodge, and includes a 35-foot waterfall and four-story fireplace. A restored Chris-Craft boat, repurposed Winnebago motor home and a virtual ski lift experience are geared toward memory care residents, who can rekindle memories by interacting with these environments.

Memory care in particular will be a focus for innovation and is one of the “most important opportunities” going forward, Engskov said.

Aegis will be focusing on more personalized and integrated care overall. Integration could mean care coordination and generally more robust and convenient services, which could be achieved through community partnerships, expanding in-house capabilities, integration of technology like telehealth, or through a variety of other means, Engskov said.

“You’ll see our company focused on creating an experience for residents, with a sense of community and giving them a sense of purpose,” he elaborated.

As the company does new development, Aegis will stick with its approach of unique designs. For instance, the next project slated to open will be in Washington’s Bellevue/Overlake area, and will be a neoclassical building inspired by the Bellevue arboretum, with an expansive greenhouse in the main entrance.

While Aegis does have 10 buildings leased with real estate investment trust HCP (NYSE: HCP), the forthcoming developments will all be Aegis-owned and operated.

Expansion will be entirely strategic rather than opportunistic, and likely will stick with the core offering of high-end assisted living and memory care — not venturing into a more middle market product, Engksov said. And achieving massive scale is not the end goal, he stressed. He believes that senior living is by nature a regional business, given the high level of involvement needed to ensure high-quality, consistent operations.

Recruiting and retaining staff is another area that is commanding Engksov’s attention. To that end, Aegis University launched about earlier this summer.

“Think of it as a platform for learning and development for Aegis of the future,” Engskov said.

Aegis University is designed as intensive training programs to develop leadership internally. The first class is already underway, with candidates for director of operations positions. Other programs will be added over the next months and years.

The company is also creating an internal program to certify care managers. Up until now, Aegis has been outsourcing certification. By bringing it in-house, the goal is to instill both the caregiving skills and the company’s values more effectively — and it will be on the company’s dime, not something that team members would pay for.

Despite this concerted push to create infrastructure for internal promotions, Aegis is also not hesitant to bring in talent from outside the company or the senior living industry, as Engskov himself demonstrates. And, the company just recently hired two other Starbucks alums — Deepa Hall and Tricia Williams.

“Those particular women were people I worked with at Starbucks for many years, and I knew them to be excellent, excellent operators,” he said. “This is a very different business, but much the operational day-to-day is very recognizable and translates well.”

There was some “happenstance” involved in bringing Hall and Williams onto the Aegis team, Engskov said, but he is not bashful about his intention to be a cheerleader about the opportunities in senior living and his desire to attract the best talent possible. He already has developed a pitch based on his own past experiences.

“Twenty years ago, someone pointed me to operations when I got into retail, and it was the most amazing thing that happened for me in my career, because if you were ambitious and hardworking and smart, you could gain responsibility, because of the sheer raw demand for talent at the time,” he said. “And I look at senior living today in the same way … anyone who’s not thinking about building their career and understanding the industry is missing a big opportunity.”

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