Utility Week

12 | 31ST JANUARY - 6TH FEBRUARY 2020 | UTILITY WEEK Interview Jackson himself gets very much involved with the work, personally receiving around 40-50 emails daily from customers. Octopus prides itself on its technology platform Kraken – an in-house customer ser- vice and billing platform based on advanced data which automates much of the energy supply chain. Jackson is passionate about the Kraken platform and is keen to praise its merits. "From the very beginning we were bringing some- thing special, which was building a technology platform that today means we are more efficient at providing bet- ter service and that enables us to relentlessly drive down prices," he says. Kraken made headlines last October when it was announced that fellow challenger brand and rival Good Energy had struck a deal to use the service from 2020, the first time the platform has been adopted by a rival supplier in the UK. But it is not just technology that the company relies on to provide customer service. Jackson describes his teams as being "grown" organically. "As we grow, for example, every 70,000 customers or so, we just grow a new team. The way we grow the team is we split existing ones, it's like cell division. Among our teams there are some all the time who are fattening up ready to split. The ones who have got the best metrics are the ones that are split. "So there's a real incentive on teams because it is going to create new leadership opportunities, everybody is going to get closer to the customer. It's how you grow your career at Octopus. The best teams split the fastest. It naturally replicates that cultural autonomy." International expansion Octopus is certainly an ambitious player and has already expanded overseas into Germany and Australia, with plans for further international expansion. Jackson admits he is oŽen approached by global investors regard- ing potential business opportunities. "Every week I'm approached by companies and inves- tors from around the world to see if we're interested in talking to them. "Not only that, when we are expanding around the world we are talking to large companies both in energy and outside in various markets. "And for a lot of that, they do talk about collabora- tion in the widest sense. It's a question about whether we partner with them for expansion, including taking investment from them." While Jackson has appointed KPMG to advise on different growth models, including the potential for international investment, he does stress that the com- pany's ambitions can be realised under current backers, Octopus Group. He says: "We appointed KPMG to help us think it through: do we carry on as we are, funded entirely through Octopus? That has got an incredible attraction, by the way. Or, as part of our international expansion, would we benefit from those international investors and their market knowledge?" "We can expand to another four to five countries and grow the UK business to five million customers funded by Octopus if we want." According to Octopus's latest accounts, the company made a loss of £5.9 million in the year to 30 April 2018. Does Jackson have concerns about how much longer Octopus Group, which manages £9 billion of invest- ment, will continue funding its energy arm? "The total investment in us is tiny compared to our scale and that underlying profitability. Any loss-making from us is because we are investing in technology, global expansion and very rapid growth here in the UK. But the underlying business is rock solid. "For a relatively modest investment of a few tens of millions in us, we have got a business that today is twice the size of Barcelona Foot- ball Club in revenue – £1.5 billion of revenue and grow- ing two or three times a year with underlying very strong economics, one that's built globally using unique tech- nology. Now that's a modest investment and it's the kind of thing that venture investors really understand well. "And then you look at the incumbents, some of whom are losing money despite charging eye-watering prices and providing poor service. And having brought no innovation to the table for 20 years." Engaging with consumers Jackson is an active voice on Twitter and is known for personally assisting his customers via the social media platform day and night. For him, consumer disengage- ment has suited the large suppliers for the past 20 years. "I think fundamentally it has suited energy compa- nies for the last two decades to ensure customers stay disengaged. If your business model is to win a customer on a low price and hike it to a high one a year later, it's probably best your customer is not looking at your stuff. "Our job is relentlessly to get customers to look at this stuff." Energy is exciting, is Jackson's philosophy, and he is keen to share his enthusiasm with customers. "We use every opportunity we can to talk to customers about their energy use, about the great value they are getting from us. I think as a result of that customers who were previ- ously disengaged have become really engaged with us. "People say energy is boring and it's just a commod- ity. I look at a bottle of Evian and I'm, like, that is a com- modity. At least the stuff we sell can turn your lights on and power your car. A bottle of Evian costs 600 times more per millilitre than tap water and yet people pay it. "Anyone who looks at energy and says it's funda- mentally boring is someone who has failed to think hard about why that is." Price cap Last year saw the introduction of the energy price cap, which will undergo a review later this year. As the law stands, the cap will expire in 2023, but Jackson says he would urge the government to roll it over. A staunch defender of the cap, which he likens to the minimum wage, Jackson says he cannot envisage a transformed market where the cap will not be needed. "We would urge the government to just roll it on because just like the minimum wage provided this fun- damental improvement in the labour market, so the price cap has provided fundamental improvement in the energy market." Octopus remains proud of its identity as a challenger to the market and the company has clearly come of age in the past 12 months. Its success at last year's Utility Week Awards only goes to highlight how Octopus wants to keep the culture of a disruptor while gaining massive scale. With more acquisitions in its sights, there will be a lot to look out for over the next year. Adam John, reporter, Utility Week "Anyone who looks at energy and says it's fundamentally boring is someone who has failed to think hard about why that is."

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