Octopus Energy Group has spun off its technology arm, Kraken, following its first standalone investment round.
The fresh funding round for Kraken was led by global investment giant D1 Capital Partners, with new investors including Fidelity International, Durable Capital Partners and Ontario Teachers’ Pension Plan Board.
Kraken – which is an AI-powered platform now contracted to serve over 70m household and business accounts worldwide – was valued at $8.65bn (£6.4bn) following the new round, with investors taking a $1bn slice of the firm.
The cash generated from the investment round will be used to fund both Octopus and Kraken, but the majority is expected to be funnelled into Octopus Energy.
Greg Jackson’s energy giant will maintain a 13.7 per cent stake in Kraken following the demerger.
Meanwhile, investors led by Octopus Capital have pumped an additional $320m (£237m) into Octopus to drive innovation and growth.
Kraken will ‘grow even faster’ after Octopus split
Greg Jackson, founder of Octopus Energy Group, said: “Kraken is in a class of its own, in terms of technology, capability, and scale.
“As an independent company with world-class backers and outstanding leadership, it will be free to grow even faster and is set to be a true UK-founded success story.”
Kraken has notched $500m in committed annual revenue through licensing deals with the likes of EDF, E.ON Next, National Grid US, Origin Energy, Plenitude and Tokyo Gas.
The demerger will permit Kraken to operate as a fully independent technology platform for utilities worldwide.
Octopus said the sale will accelerate global adoption and deepen partnerships, allowing the wider group to focus on scaling its consumer, generation, and clean technology businesses.
Amir Orad, chief executive of Kraken, said: “Becoming an independent company gives Kraken the focus and freedom to scale as a neutral, global operating system for utilities, with Octopus Energy remaining a key innovation partner and forward-thinking global customer.
“I’m excited to welcome our new investors, led by D1. With their backing, we can accelerate our impact on the energy transition, deepen partnerships with utilities worldwide, and help modernise the energy system at global scale – our goal being to positively impact a billion lives within a decade.”