Oxford Street, London’s bustling shopping mecca, seems an odd place to find a UK technology powerhouse. But just off the thoroughfare, above a branch of H&M, is the lair of Kraken Technologies, a little-known outfit that has shaken the domestic energy market, gone global and wowed a group of investors that includes, somewhat incongruously, our own government.
Kraken’s one-floor HQ has purple carpets, dark blue walls and pink, octopus-like logos and cuddly toys scattered throughout. But it’s quiet, with many desks lying empty for my visit. “It’s Friday,” shrugs one of my hosts. Aside from the hum of computer servers, most of the space is filled with the sound of keyboards tapping out messages across hundreds of Slack channels (emails, apparently, aren’t really a thing here).
You may not have heard of Kraken, which takes its name from a mythical Scandinavian many-tentacled sea monster. You may incorrectly assume it has something to do with cryptocurrency, due to a US company of the same name. But if you’re a customer of Octopus Energy (Kraken’s soon-to-be former parent), EDF or E.ON, you will have used, and possibly benefited from, its services — as might customers of Severn Trent or TalkTalk, with Kraken having moved into the water and telecoms sectors in recent years.
Kraken’s Oxford Street offices
KRAKEN
The company opens your account, sends your monthly bill, measures your smart meter, collects your payments, publishes your statements, manages your solar panels, saves you money with overnight electric vehicle (EV) charging, and, when you have a complaint, swiftly directs you to the right call centre — with minimal holding music and transferral between departments.
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You wouldn’t know it from the office atmosphere, but Kraken — which employs 2,000 people, half of them in London — is having a moment. In the process of being separated from Octopus (which is based upstairs in a bigger office), it was recently valued at $8.65 billion (£6.25 billion) following a fundraising round led by US investment giant D1 Capital Partners, which also holds stakes in Rolls-Royce and Elon Musk’s SpaceX. Weeks later, the UK’s state-owned British Business Bank invested a further £25 million.
Cue some scepticism. On the surface, Kraken is everything that advocates of the UK technology sector have been yearning for: a young company that has zoomed past start-up status, developed tangible tools to improve productivity, and proven itself on the world stage. Just as Dyson fans are drying hands in public bathrooms across the globe, so Kraken, with 70 million customer accounts under its belt, is running many of the world’s energy meters and EV charging points.
But critics, including whispering rivals and one vocal sector analyst, believe the Kraken story is all too good to be true. They scoff at the valuation, raise concerns about the capital structure, and question the wisdom behind the state investment. As for Kraken’s tech — which includes AI tools to sift through customer messages (letters, emails, WhatsApps etc) to connect them to the right company representative — it is now, in the words of one sector foe, “eminently replicable”.
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Amir Orad, Kraken’s Israeli-born, New York-based chief executive since 2024, has heard it all before. Every new client, he said, takes up to two years to make the switch. “They want to make sure they’re doing the right thing for their households,” he insisted. “So they spend endless time ensuring this is the right technology.
“It can take dozens of workshops, multiple executive meetings, site visits … making sure the bride is who she claims to be. And each and every time, they come [away] saying: ‘Wow, we thought it was too good to be true, and it is actually working.’ ”
Amir Orad became chief executive in 2024
KRAKEN
One of those customers is EDF, the French-owned energy provider that moved six million UK customers over to a Kraken operating system in 2024. Philippe Commaret, EDF’s managing director of customers, said Kraken had helped increase his company’s Trustpilot score from 4.1 to 4.8, leading to a marked reduction in cancelled contracts.
He also said it had allowed EDF to cut 1,700 call centre staff in South Africa and the Philippines, while retaining UK roles.
Commaret described the Kraken platform as “highly intuitive” for staff. When a customer calls, its tech swiftly identifies them and allocates them to employees. They will know the customer’s name, be able to read their history with the company (when they signed up, their contract, whether they’ve missed payments etc) and have access to recordings of previous interactions, which can be played back at two times’ normal speed or read via an AI summary.
To understand Kraken, its tools and its unlikely success, you need to understand Octopus and its boyish founder, Greg Jackson, 54 Brought up near Middlesbrough by a single mother, Jackson was a tech nerd teenager who dreamt of designing video games. He started his career as a marketer at the consumer goods giant Procter & Gamble and was later involved in several tech businesses.
A decade ago, Jackson identified the energy supply market, then dominated by a “big six” led by Centrica’s British Gas, as being ripe for disruption. His theory was that a challenger, freed from the shackles of old technology, legacy contracts, dead-wood employees and bureaucracy, could charm customers to win market share.
Greg Jackson bans staff from having desk drawers to keep the office decluttered
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Jackson built a company in this image, insisting on having no HR department and banning staff from having desk drawers in order to declutter the office.
Today, Octopus is the UK’s largest energy supplier. And the secret of that success was its technology platform, which Jackson later branded Kraken and started licensing out in 2020.
So how did the big six allow a cheeky upstart to beat them by developing new and better technologies than they could muster? And how has this British company been able to sell this technology globally?
Orad, who previously led the New York-based data analytics firm Sisense, believes that while the US energy market is “heavily regulated and not competitive”, the UK runs a “highly competitive, advanced regime that encourages innovation”.
“The second question is: why didn’t a big company [develop Kraken] , but a small company that had nothing at the beginning did?” he asked. “The answer lies in the question: because we dare to imagine the entire end-to-end system … If you’re an old-school utility and you have thousands of systems … daring to think about changing all of them together would be practically impossible.”
Even most rivals would grudgingly admit that Jackson and his team spotted an opportunity and forced others to improve their customer service. But “first-mover advantage”, as one rival put it, doesn’t necessarily endure. Many competitors can now offer similar services to Kraken. Centrica, for example, bought ENSEK, the developer behind customer management platform Ignition, in 2024. Now that all British Gas customers have been moved on to Ignition, the company is said to be seeing improvements in satisfaction scores.
Orad and his team are confident that Kraken can maintain its advantage. This is not only because it has already locked many clients into long-term contracts, but also because of its internal culture and ever-updating technology.
David Winterbottom, Kraken’s principal software engineer, said his company had a “nothing is sacred” policy; any member of staff, no matter how junior, can challenge a piece of code or part of the system and force change. That is one reason why Kraken’s platform generally updates with new “versions” hundreds of times a day.
But bigger challenges may wait around the corner. Kathryn Porter, an energy industry consultant and analyst, last week raised concerns about the financial health of Octopus and how this might affect Kraken.
Octopus, she noted, does not currently hold enough capital to meet industry rules that require energy suppliers to hold £115 in reserve for every customer, to insure them against collapse. Octopus has admitted it does not meet the targets but is in compliance with Ofgem rules because it has an approved plan to reach them.
Porter posited that Octopus needs the proceeds of a Kraken share sale to meet this threshold. And she also raised concerns about Kraken being listed as a loan guarantor for Octopus. It is understood this arrangement will be severed when the companies formally demerge this year.
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Then there is Kraken’s $8.65 billion valuation. Porter described this as “stretched”, given that it is 17 times the tech company’s $500 million of contracted annual revenues. And the taxpayer’s £25 million stake in Kraken will only increase scrutiny.
The theory is that the UK government’s motivation was to encourage Kraken to list its shares in London, rather than New York, when it decides to go public. Jackson has said he would like to see the UK and London demonstrate more “hustle” to win the float. Business secretary Peter Kyle told the Financial Times last month that the investment was “not a bung”.
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Kraken’s latest Companies House accounts show it made a loss of £5 million in the nine months to January on revenues of £164 million. Clearly, revenues have grown since then. But Orad said nobody should expect mega-profits any time soon.
“We are roughly break-even at this point, which means one month we’re up, one month we’re down,” he said. “Every dollar we add to the business goes back to innovation because the opportunity is massive, because the incumbent infrastructure we replace is so stuck in the past. There is endless room for innovation every day.”
That ethos sounds a little like the one championed by big US tech companies — and it’s the kind of high-growth stardust that the London stock market may dream of attracting.
