Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
The UK government will take a £25mn stake in Kraken, the technology business that is being spun out of Octopus Energy, as it tries to persuade the business to choose London for a future stock exchange listing.
Kraken was valued at $8.65bn last month as part of a deal to sell a minority stake to a syndicate of investors, in the first standalone investment round for the software business since it was developed inside Octopus Energy.
The government said the Kraken investment — which is being made via the state’s economic development lender, the British Business Bank — was to “help them scale up and aim to keep them here in the UK”.
The investment comes after Greg Jackson, the high-profile founder of Octopus Energy, last month accused the London Stock Exchange of not having enough “hustle”, adding that it was a “coin toss” between the tech unit listing in London or New York.
Jackson, who has also been appointed as a government adviser and non-executive member of the Cabinet Office board, told the FT last week: “From a personal point of view I would love to list in London, but it is ultimately a choice for shareholders, who are a global group of investors.” A decision on where to list is expected in the next 18 months.
The London Stock Exchange has struggled to lure technology companies to the UK market and has been hit by a series of departures, including payments group Wise that last year moved its primary listing to New York.
Peter Kyle, the UK business secretary, said in an interview with the FT that the government’s investment in Kraken was “not a bung” but he did acknowledge it was part of efforts to keep the company in the UK.
Kyle said: “I’m keen that we use the resources that we have as a state to invest in those companies which have the capacity to scale fast, to create jobs, to create wealth.
“I really hope that Kraken does list here, but does so on the merits of the London Stock Exchange . . . and this being the best place in the world to scale a company.”
He added that there were not any conditions tied to the BBB’s stake should Kraken choose to float elsewhere. But he did not specify what would happen if it was taken over by a foreign buyer. “I’m really open minded about this and incredibly pragmatic,” he said.
Kyle added: “I see Kraken as being highly innovative, disruptive . . . And it has the potential to become a great UK business. Why wouldn’t I want to be part of that?”
The BBB had its funding capacity increased from £15.6bn to £25.6bn in last summer’s spending review and has a mandate to invest in companies that can deliver economic growth. The £25mn Kraken stake is part of a wider £125mn investment by the BBB into life sciences, deep tech and AI.
Kyle said the sizeable investment in Kraken reflected the BBB being bolder and added that it had in the past been too risk averse.
The business secretary said he was pitching London to companies by highlighting that in the US they would find themselves “in a big sea of competitors”.
The London Stock Exchange has been assuring IPO candidates that larger companies will quickly be included in the FTSE indices, getting a boost in terms of investment from index tracker funds. It can take longer to secure inclusion in the S&P 500.
Recent investors in Kraken include D1 Capital Partners, Fidelity and a unit of the Ontario Teachers’ Pension Plan, while its original backers included Australia’s Origin Energy, Japan’s Tokyo Gas, the Canada Pension Plan Investment Board and Al Gore’s Generation Investment Management.
Jackson said that while he was encouraged by changes on policy and regulation, such as the reform of UK listing rules, “capital was the key for choosing where companies list”.
“After all, it is a shame that no matter where we list it will likely result in richer Canadian pensioners than British ones. I hope that in the future British pensioners will benefit more from growth companies that start here.”
Kraken had 73mn accounts in April 2025, according to Octopus Energy’s filings, up from 51mn the year before. The company said that its recurring revenue had doubled to £422mn in the year to the end of April 2025.