An Octopus Energy branded electric car is parked in front of a modern suburban house in Folkestone, England on March 19, 2025. The home has rooftop solar panels, highlighting its commitment to renewable energy. This scene represents the growing adoption of sustainable energy solutions, with Octopus Energy playing a key role in accelerating the integration of electric mobility and solar power generation. (Photo credit: Andrew Aitchison / Photo via Getty Images)
Andrew Aitchison | In Photo | Getty Images
British renewable energy startup Octopus Energy is preparing to spin out its AI technology arm Kraken Technologies and prepare for a possible listing.
Origin Energy, which owns a major stake in Octopus, said in a statement late Monday that Octopus had raised $1 billion in its first solo funding round, valuing the business at $8.65 billion. The funding round paves the way for the spinoff, with Octopus targeting separation by mid-2026, Origin said.
In a statement, it said that “Kraken’s major client” and Daniel Sundheim’s hedge fund D1 Capital Partners, which it did not name, were involved in the investment round. Origin will also invest $140 million as part of the process.
“With this major new customer agreement, Kraken is rapidly approaching our 100 million customer account goal, significantly ahead of schedule,” said Origin CEO Frank Calabria.
Octopus Energy will retain a 13.7% stake in Kraken after the spin-out, while Origin’s interest in Kraken will remain at 22.7%.
“We believe these transactions place Octopus and Kraken in a strong position to realize their next phase of growth, supported by the right capital structure,” Calabria added.
Kraken provides energy software to power companies such as EDF and E.ON. Origin Energy says its contracted annual recurring revenue has more than doubled in the past 18 months.
Earlier this year, Kraken CEO Amir Orad told CNBC’s “Squawk Box Europe” that the company has a “very strong investor base” focused on energy and utilities.
Kraken has benefited from Octopus’ ownership as more energy companies license its technology, turning the company into what Orad describes as “a modern operating system for utilities.”
Asked about going public in September, Orado told CNBC that “the opportunity is great,” but Kraken needs to focus on being a pure software company.
“With this, we expect to acquire more pure-play software long-term late-stage investors over time. Currently, we have a very strong investor base focused on energy and utilities. Over the years… we expect that to evolve into something more software-focused given (the separation),” he said.
—CNBC’s Domi Suskova contributed to this report.
