The British Business Bank (BBB), the UK government's state-owned economic development bank, committed GBP 25 million in direct equity to Kraken Technologies, announced 20 January 2026 — the Bank's largest direct investment in a private company to date. Kraken is an AI-driven energy and utilities operating system, licensed to utilities serving over 70 million customer accounts worldwide, and is being spun out of Octopus Energy Group in a transaction that raised c. USD 1 billion from investors including D1 Capital Partners, Fidelity International, Durable Capital Partners and Ontario Teachers' Pension Plan Board's Teachers' Venture Growth, valuing Kraken at USD 8.65 billion. Business Secretary Peter Kyle framed the stake as keeping a strategically important UK-founded scale-up anchored domestically, part of a wider package under the Modern Industrial Strategy.

Analyst notesShow

Mechanism

The British Business Bank committed GBP 25 million as a direct equity investor in Kraken Technologies, the AI-powered customer-service and billing operating system for energy and water utilities that Octopus Energy Group is demerging into a standalone company. The round is led by D1 Capital Partners alongside Fidelity International, Durable Capital Partners and Ontario Teachers' Pension Plan Board (via Teachers' Venture Growth), raising roughly USD 1 billion in total and valuing Kraken at USD 8.65 billion. Kraken now licenses its platform to utilities managing over 70 million customer accounts globally, spanning billing, smart-meter data and home-battery/flexibility management.

BBB's stake is its largest single direct investment into a private company, made possible after the Bank's 2025 investment-capability reforms lifted its financial capacity from GBP 15.6 billion to GBP 25.6 billion, expanding its remit to write larger direct cheques into strategically important scale-ups rather than routing solely through fund-of-funds vehicles (as in the BBB/British Patient Capital commitment to IQ Capital Fund V announced the same day). Business Secretary Peter Kyle announced the investment during a visit to Kraken's London headquarters, tying it explicitly to keeping a UK-founded, globally-licensed energy-tech platform anchored domestically ahead of a possible future listing.

Downstream implications

Signals BBB's shift toward larger, company-specific direct equity

cheques (GBP 25m, its record to date) rather than only fund-of-funds commitments, consistent with its enlarged GBP 25.6bn capital base.

Kraken's software-licensing model (not domestic energy generation)

places this in the energy-technology/AI-software policy lane rather than clean-power capex; distinct from BBB's National Wealth Fund-adjacent hard-infrastructure deals.

Octopus Energy's Kraken demerger and potential future London/US

dual listing is a signal to watch for subsequent UK state involvement (e.g. further BBB follow-on, IPO-readiness support).

Open questions

Whether BBB takes a board seat or governance rights alongside the

GBP 25m stake, and how it exits if Kraken lists publicly.

Whether Kraken's international licensing footprint (70m+ accounts

across multiple jurisdictions) draws inbound investment-screening attention in partner markets given its embedded position in utility billing/metering infrastructure.

Sources

Primary: British Business Bank — press release, 20 January 2026

Secondary: Global Trade Alert — state act 96099 (UK direct equity support to Kraken Technologies)

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Mechanism

Downstream implications

Signals BBB's shift toward larger, company-specific direct equity

cheques (GBP 25m, its record to date) rather than only fund-of-funds commitments, consistent with its enlarged GBP 25.6bn capital base.

Kraken's software-licensing model (not domestic energy generation)

places this in the energy-technology/AI-software policy lane rather than clean-power capex; distinct from BBB's National Wealth Fund-adjacent hard-infrastructure deals.

Octopus Energy's Kraken demerger and potential future London/US

dual listing is a signal to watch for subsequent UK state involvement (e.g. further BBB follow-on, IPO-readiness support).

Open questions

Whether BBB takes a board seat or governance rights alongside the

GBP 25m stake, and how it exits if Kraken lists publicly.

Whether Kraken's international licensing footprint (70m+ accounts

across multiple jurisdictions) draws inbound investment-screening attention in partner markets given its embedded position in utility billing/metering infrastructure.