Podcast Summary
From selling video games to founding Octopus Energy: Greg Jackson's inspiring journey: Growing up in a challenging environment, Greg Jackson's determination, creativity, and strong sense of purpose led him to create Octopus Energy, demonstrating the power of resilience, innovation, and belief in one's abilities.
Determination, creativity, and a strong sense of purpose, instilled in Greg Jackson by his resilient single mother, played a significant role in his journey from a teenager selling video games to founding one of the UK's leading energy companies, Octopus Energy. Despite growing up in a challenging environment, Greg's experiences fueled his ambition and confidence, leading him to create something meaningful and impactful. His story is a testament to the power of resilience, innovation, and the belief in one's abilities, even when faced with adversity.
Childhood experiences shaped his resilience: Early life struggles led him to drop out of school and pursue video game development, but his determination and adaptability eventually led to success. Father's absence and university lessons about preparation influenced his entrepreneurial mindset.
The speaker's early experiences of his father leaving him and feeling the pressure of being the man of the family led him to leave school to pursue his passion for video game development. Despite initial failures, he continued to learn and adapt, eventually finding success through hard work and determination. Additionally, his father's absence and the lessons he learned in university about the importance of preparation and hard work significantly influenced his mindset and approach to entrepreneurship. Overall, these experiences shaped his resilience and drive to succeed.
From industry jobs to successful entrepreneurship through process optimization: Identifying opportunities to use technology to improve processes can lead to successful entrepreneurship in unexpected industries.
Passion and a desire to improve processes can lead to successful entrepreneurship, even in unexpected industries. The speaker shares his journey from wanting to escape industry jobs in Teesside to starting a mirror manufacturing business in London, where he optimized production using technology. He then moved on to focus on data processing and building enterprise software, which became Octopus. Despite the challenges of manufacturing in the UK, especially in high-cost areas like London, the speaker remained optimistic and found success by focusing on areas where technology could make a significant impact. His experiences demonstrate the importance of identifying opportunities to use technology to improve processes and the potential for entrepreneurship in various industries.
A successful partnership between a founder and engineer fueled Octopus Energy's growth: A strong partnership between a founder and engineer, based on shared focus and dedication, can lead to successful business growth.
The founders of Octopus Energy, a successful energy tech company, built their business on a strong partnership with a brilliant engineer and a shared focus on the company, rather than friendship or socialization. They started the business in 2003, and James Edison, a university friend and software engineer, helped part-time before fully joining the team. Their success includes the software platform Kraken, which enables better customer service by replacing outdated systems in larger energy companies. Octopus Energy's customer obsession, driven by Kraken, is a major contributor to their success. Despite not being friends, the founders' dedication and integrity have kept the company focused on its goals since its inception.
Octopus Energy's Kraken software streamlines operations and reduces costs: Kraken integrates various systems, eliminates handovers, and saves Octopus Energy £50-£100 per year per customer in running costs. It also facilitates energy forecasting and trading, incentivizing energy usage during off-peak hours to save costs for consumers and the system.
Kraken, a software used by Octopus Energy, streamlines operations, reduces costs, and facilitates energy transition. By integrating various systems, Kraken eliminates handovers between departments and minimizes mistakes. The cost savings are significant, with Octopus Energy reporting a £50 to £100 per year reduction in running costs per customer. Furthermore, Kraken's capabilities are crucial in the complex world of renewable energy, where forecasting generation from numerous sources is essential. The system functions similarly to energy trading firms, but in the interest of customers. Octopus Energy also engages in energy trading and offers tariffs like Agile, which encourages energy usage during off-peak hours, reducing overall demand and saving costs for consumers and the system. Another initiative, saving sessions, incentivizes customers to shift energy usage during peak hours, reducing the need for expensive standby coal power plants. Overall, Kraken's integration and optimization of energy supply and demand contribute to cost savings, a cleaner energy mix, and improved customer service.
Affordability and Convenience of Electric Cars: Electric cars are more cost-effective than traditional cars, especially for those with off-street parking and home charging. Early stage UK businesses face challenges in securing later stage investment, leading some to seek funding abroad.
Electric cars are becoming increasingly affordable and convenient for consumers, with the cost per 100 miles being significantly lower than petrol or diesel cars. For those with off-street parking, charging at home can be done automatically and cheaply. Octopus Energy, a successful UK business, was able to secure early stage investment domestically but faced challenges in raising capital for growth. The UK is seen as a good place for early stage investment due to government schemes, but later stage investment is harder to come by, leading many companies to seek funding abroad. Octopus Energy raised £10 million before signing a single customer to ensure a stable and robust business from the start. Despite these challenges, the UK's global connections provide valuable relationships and a global perspective, but also mean less capital is available for public and private companies.
Company culture with employee ownership: Giving all employees equity builds motivation, fairness, and long-term commitment. Renewable energy is a key solution to climate change and becoming cheaper than fossil fuels.
Creating a company culture where every employee is a shareholder can significantly increase motivation, alignment, and long-term commitment to the business. This was the approach taken by the interviewee, who shares equity with all 7,000 employees in his company. This not only ensures fairness but also fosters a sense of collective ownership and investment in the company's success. The conversation also touched upon the importance of renewable energy in addressing climate change and the interviewee's investment in Xlinks, a company developing the world's largest subsea cable bringing renewable energy from Morocco to the UK. The interviewee emphasized the significance of renewable energy becoming cheaper than fossil fuels and the potential for industries and electric vehicles to tap into renewable energy sources when they are abundant. Despite the challenges in persuading investors to give up a larger share of equity, the interviewee's long-term vision and commitment to fairness and employee ownership paid off.
The challenges of large nuclear projects: Despite high costs and delays, smaller, quicker, and cheaper nuclear projects should be considered, while effective market structures and industrial policies support larger projects if feasible.
The high costs and delays in large nuclear projects, such as the one being discussed, have raised questions about whether the investment is worth it, especially when compared to the rapid advancements and affordability of renewable energy sources. The interviewee suggests that the UK's track record on large projects is not great, and this issue is not unique to the UK. Instead, they propose focusing on smaller, quicker, and cheaper projects while continuing to explore nuclear options if feasible. The interviewee also touches upon the importance of industrial policy and effective market structures to support large-scale projects, as seen in countries like France. Overall, the conversation highlights the need for a balanced approach to energy production that considers both the environmental impact and economic feasibility of various options.
Changing the Energy Market Structure for Substantial Savings and Investment Opportunities: A regional pricing system in the energy market could save £62bn between now and 2040, reduce the need for expensive infrastructure, and attract industries, leading to substantial savings and investment opportunities.
The current energy market structure in the UK, which results in turning off wind farms during windy periods in Scotland and charging everyone the same high price, could be changed to a more efficient system where regions with high renewable energy production sell their excess electricity to other regions at lower prices. This regional pricing system would not only benefit the North of the UK, where power is intrinsically cheap, but also every region, leading to substantial savings and investment opportunities. According to a study by FTI Consulting for Ofgem, this change could save £62,000,000,000 between now and 2040. Moreover, it would reduce the need for expensive transmission infrastructure and attract industries to relocate, creating real growth. The technology for long-distance electricity transmission already exists, and projects like Xlinks, which aims to build a cable between the UK and Morocco, could provide 7% of the UK's electricity. The process for setting the floor price every 3 months and the lack of a social tariff during the cost of living crisis are two areas that need attention as we move towards a market-driven energy system. In the past, market forces have proven successful in industries like retail, and it's time to apply the same principle to the energy sector.
Collaboration and Innovation in the Energy Sector: Octopus Energy licenses its software, Kraken, to competitors for improved efficiency and cost reduction, fostering innovation and benefiting all players in the energy sector. However, the need for a more efficient energy system to address equity and fairness issues is also emphasized.
While competition is essential to prevent monopolies and keep prices in check, the energy sector's complexity necessitates collaboration and innovation. Octopus Energy, a leading player in the industry, recognizes this and has adopted a unique approach by licensing its proprietary software, Kraken, to competitors. Kraken, a game-changing software for large energy utilities, is used by multiple companies to improve efficiency and reduce costs. This collaboration allows for the rapid adoption of innovations and benefits all players in the sector. However, the discussion also touched upon the need for a more efficient energy system to free up resources for addressing equity and fairness issues, such as social tariffs. The exact form of social tariffs, who pays, and how they are funded, remains a topic of debate.
Using AI to Improve Energy Operations: AI can help address challenges in the energy sector by improving operations, from forecasting to customer service, reducing wait times and increasing customer satisfaction.
While the question of social tariffs and affordable energy is a valid one, the real issue lies in the systemic challenges that prevent the full benefits of renewable energy from being realized. These challenges include the slow process of getting grid connections and planning permissions. Kraken, a technology-based energy company, is using AI to improve its operations, from forecasting to customer service. During the energy crisis, Kraken deployed AI to handle customer service emails, reducing wait times and increasing customer satisfaction. The AI was able to quickly analyze historical data, a task that would be challenging for humans. Kraken's use of AI is an example of how technology can be used to address some of the challenges in the energy sector and improve the overall system. However, more systemic changes are needed to make energy truly affordable and accessible for all.
Octopus Energy uses AI for customer service enhancement: Octopus Energy uses AI to automate email responses, gamify meter reading submission, and provides efficient and fun customer experience, resulting in higher net promoter score compared to competitors.
Octopus Energy, a leading energy company in the UK, is leveraging AI technology to enhance customer service and experience. By integrating OpenAI's language model, they have automated email responses, allowing their team to focus on more complex queries. Additionally, they have gamified the process of submitting meter readings by introducing a "wheel of fortune" feature, which has proven to be popular among customers. Octopus Energy, which is expanding globally, operates in six other countries and has built renewables in the UK and other nations. They have a net promoter score that is significantly higher than their competitors. The use of AI not only improves efficiency but also adds an element of fun and excitement for customers. This innovative approach sets Octopus Energy apart in the energy sector.
From humble beginnings to leading a big energy company, the power of determination and innovation: Determination and innovation, fueled by passion, can lead to unexpected successes in entrepreneurship. The use of AI and technology can revolutionize industries and improve access to essential resources like renewable energy.
Entrepreneurship and passion can come from unexpected places, even with humble beginnings and hardships. Our interviewee, for instance, grew up with a single mother and went from making computer games and selling mirrors to leading a big energy company, all while being obsessed with artificial intelligence and using it to communicate efficiently with customers. The AI-generated letters reportedly surpass human satisfaction levels, signaling a shift towards a more technologically advanced world. Moreover, the use of technology to make cheap renewable power accessible to all, especially in regions where it's most needed, could revolutionize the energy industry and level up communities. A missed opportunity for the government to make this a reality is a stark reminder of the potential benefits that could be missed if not addressed. Overall, the interview highlights the power of determination, innovation, and technology to create a better future.
