Greg Jackson’s Octopus Energy has unveiled plans to spin off its technology division Kraken as an independent entity.
The company stated the decision aims to “accelerate the platform’s global expansion” whilst enabling Kraken to “fast-track investments into its technology, expand into new energy markets and regions, and drive innovation”.
Kraken boasts $500m in committed annual revenue through licensing agreements with major players including EDF, E.ON Next, National Grid US, Origin Energy, Plenitude and Tokyo Gas, as reported by City AM.
The AI-driven platform is now contracted to manage more than 70m household and business accounts globally.
As part of the separation, Tim Wan has been appointed as Kraken’s new chief financial officer.
Earlier this year, Octopus Energy became the UK’s largest energy supplier, now serving over 7.7m UK households.
‘I am so proud that the business is smashing it’
Greg Jackson, founder of the Octopus Energy Group, said: “We set out to create Kraken as a global platform to transform utilities and deliver the innovation, service and value that customers deserve.
“I am so proud that the business is smashing it – and is now such a huge and successful company in its own right.
“Under Amir’s leadership and with a remarkably talented team, Kraken is soaring to new heights.
“I set the embarrassingly low goal of 100,000,000 accounts by 2027. It looks like it’ll beat that and can now aim to serve a billion people over the next decade.”
Kraken given more ‘freedom to invest’
Amir Orad, CEO of Kraken, added: “Octopus has been a phenomenal founding partner and first client.
“Kraken is now a globally successful business in its own right, operating independently for some time – completing our journey to full independence is a strategic and inevitable next step.
“It gives us more freedom to invest, expand, and serve our utility clients equally.
“We’ll keep pushing innovation in the cloud, advancing our utility-grade AI and harnessing vast amounts of energy and grid data, while ensuring structural clarity for customers, investors, and partners.
“We are aiming to accelerate the energy transition and positively impact people around the world. This is an exciting next chapter for Kraken.”
Profit down at Octopus Energy as costs rise
City AM previously disclosed in February that Octopus Energy had witnessed a sharp decline in profitability as escalating expenses and diminishing revenues squeezed margins throughout the energy giant’s most recent trading period.
During the 12 months ending 30 April, 2024, the company delivered net earnings of £83m, representing a significant drop from the £203m achieved in the preceding year.
Turnover similarly declined from £12.54bn to £12.4bn across the comparable timeframe.
The group’s revenue had previously surged threefold from £4bn in the earlier 12-month period.
Octopus Energy Group confirmed in a statement that its UK retail energy division had absorbed an additional £74m in expenses “to keep customer bills lower during the energy crisis and support the ones most in need”. The group also revealed that its non-UK retail customer base had tripled to 1.2m, while its global workforce had seen a significant increase from 4,800 to 8,500.
